ROME (AP) — The head of Latin America’s top development bank made his case to Pope Leo XIV this week for more mining, even as the Vatican has moved to divest from the industry that has long ravaged Indigenous lands, poisoned waterways and stripped wealth from Latin America. Ilan Goldfajn, head of the Inter-American Development Bank, met privately with the pope on Friday and argued that rare earth mining could be a boon to the region if the extraction is wrapped in safeguards, local value-added work and the usual polished language of “governance.”
Goldfajn said in an interview in Rome on June 18 that rare earth mining is “a unique opportunity for the region, but you need to do it in the right way with the standards, the labor conditions, with the environmental conditions, the governance.” He added, “We have exactly the tools to do that,” while noting that the IADB has a roughly $4 billion pipeline of critical mineral projects in the region, mostly in Chile, Argentina and Brazil, and three-quarters of that amount with private companies. He had just delivered a presentation on rare earth minerals at a finance conference, with an eye on potential European investors.
Who Gets the Risk, Who Gets the Profit
The pitch lands in a region where mining’s history is written in forced labor, displacement of Indigenous peoples, deforestation, poisoned waterways and deadly dam collapses. Foreign companies withdrew much of the wealth from the earth without enriching local populations. In colonial times, silver and gold made its way across the ocean to adorn Catholic churches. The old arrangement has changed its branding, not its basic logic: extraction at the bottom, accumulation at the top.
The Vatican has for years taken a firm stand against multinational mining corporations, especially in Latin America and in favor of Indigenous peoples, whose lands and livelihoods are often ravaged when mining projects come to town. Goldfajn’s visit followed one earlier this year by mining executives and suggested a desire to sensitize the pope to the possibility of a better way of doing business. Whether Leo can be swayed is another matter, given his own experience in the region and criticism of the often corrupt deals mining companies ink with governments in the developing world.
Countries have identified dozens of minerals, including copper, cobalt, lithium and nickel, as critical because they are essential for new technologies. The 17 rare earth elements are a subset of them and are used in a wide range of products, including smartphones, semiconductors, electric vehicles and jet engines. The global tech boom, in other words, sits on a foundation of extraction that someone else is expected to absorb.
The Church, the Bank, and the Extraction Machine
Leo, who spent two decades working as a missionary in Peru, would be intimately familiar with the plight of Indigenous peoples in mining areas and the environmental impact of extraction industries on the land. He ministered in Chulucanas, in the archdiocese of Piura, which has huge copper mining projects, and in Trujillo, known for its gold deposits. His final Peruvian posting, Chiclayo, is a big logistical hub for northern Peru’s extraction industries.
Goldfajn said of Leo’s time in Peru, “He must have seen both sides: the promise, the future, but also the challenges.” He noted that Leo held a private audience with a group of top mining executives in January, which he heard from them had been “very constructive.” But two months later, the Vatican launched a campaign to encourage divestment from mining companies. At a Vatican news conference, top officials held up an ecumenical Christian network, known as the Church and Mining Network, that is active in particular in Latin America. The campaign seeks to encourage local churches to review their investment strategies and divest where needed, and to share information especially with Indigenous groups about the types of extraction occurring on their lands.
The Vatican did not provide any readout of Leo’s private audience with Goldfajn. In a separate audience Friday, Leo met with participants in a conference at the Vatican’s environmental educational center named for Francis’ 2015 encyclical. He denounced the profit-at-all cost mentality of those who seek to plunder the earth “at the expense of the most vulnerable and enhances the risk of dehumanization.”
Leo’s predecessor, Pope Francis, a native of Argentina, singled out the toll of mining in his 2015 environmental encyclical “Praised Be,” noting the pollution of underground water systems as a result of runoff, the mercury pollution in gold mining or sulfur dioxide pollution in copper mining. Francis said it was “essential” for Indigenous communities to be the principal dialogue partners when large projects affecting their land are being considered.
What the Institutions Call Safeguards
Bryan Harris, managing partner at Sabio, a Latin America-focused strategic advisory firm, said in an email that it makes sense for people like Goldfajn to try to engage Leo, even if the pope alone won’t move investment decisions. Harris said, “The decades he spent in Peru give him personal credibility and his messaging on mining sets the tone for how dioceses and parishes across the continent will engage with mining companies and projects.” He added, “These groups are often the basis of local opposition movements to mining, so the Pope has considerable sway on whether relations are confrontational or conciliatory.” Harris also noted that processing of rare earths can be extremely dirty, involving heavy chemical use that can contaminate water resources without close monitoring of companies’ sustainability commitments and enforcement by federal regulators.
That is the familiar script: private capital wants access, institutions promise oversight, and the people living on the land are told to trust standards, commitments and regulators. Meanwhile, the IADB says it has a roughly $4 billion pipeline of critical mineral projects, mostly in Chile, Argentina and Brazil, and three-quarters of that amount with private companies. The machinery is already moving.
Leo is expected to visit Peru in November, including places where he ministered. In each of the three sub-Saharan countries he visited during his April trip to Africa — Cameroon, Angola and Equatorial Guinea — he blasted the “colonization” of Africa’s minerals by mining companies.
There are 75 million tons (82.7 million U.S. tons) of rare earth oxides around the world, more than half in China, and Brazil has the second-largest reserves, according to the U.S. Geological Survey’s most recent estimate. The numbers are treated as opportunity by bankers and investors; for the communities living where the digging happens, they are often the starting point for another round of dispossession.