What we do?

The new boom in projects linked to the energy transition and China’s leading role promise a new form of development, a “green development”; however, in addition to promoting new industries, this agenda must pay attention to the content and implementation of social and environmental standards for foreign investments. To this end, this Working Paper analyzes the main environmental and social standards in the mining and energy sectors in Peru, Chile, Colombia, and Argentina and, through the analysis of emblematic cases, examines the quality of compliance with these standards by Chinese companies. The study found that social and environmental institutions and standards have shortcomings related to the level of autonomy of environmental agencies; limited mechanisms for substantive participation throughout environmental studies; questionable standards for consultations to obtain the free, prior, and informed consent of indigenous peoples; and problems with labor relations. These regulatory and implementation problems largely stem from the need to ensure stability for all international investments, regardless of nationality, even at the expense of the substantive participation of local communities and the equitable distribution of benefits. Chinese investments, however, not only face problems common to all investments, but also respond to these problems with limited due diligence practices and substantive participation. All of this calls into question the promises of “green development” contained in investments in projects related to critical minerals and the energy transition. Without robust social and environmental standards, and without planning that encourages a shift in the energy mix in raw material-producing countries, the green development agenda can become mere development, justified by rhetoric of environmental sustainability.