Peru’s presidential frontrunner is risky for Chinese mining firms

Socialist candidate Pedro Castillo has proposed new royalties on mineral sales, wants to renegotiate existing tax deals.

Peru’s presidential frontrunner is taking aim at copper mining firms’ coveted tax stability agreements that freeze tariffs, and the plan could have an outsized impact on Chinese miners in the world’s second-biggest producer of the red metal. Socialist candidate Pedro Castillo, the narrow favourite to win Sunday’s runoff vote, has proposed new royalties on mineral sales and has floated a plan to renegotiate longstanding tax deals struck under previous governments. A teacher who was a shock winner in the first round vote, Castillo has accused mining firms of “plundering” Peru’s wealth. He has spoken about more than doubling the state’s share of mining profits to 70 percent and using the funds for boosting healthcare and education and reducing income inequality.