Peru’s Political Landscape 2016


Come April 10th a first round of voting will take place in Latin America’s fastest growing country, Peru. A second round will be necessary if no one candidate is able to pass the 50% needed to claim victory. At this time, polls are signalling to prepare for a second round. After the second round, President Ollanta Humala, a left leaning leader will officially hand over the reigns of this mining powerhouse to the new president on the 28th of July. The field unlike last election is powered by the centre right, however, a left candidate from Cusco is also in the mix.

Who are the candidates running for president?

Keiko Fujimori (32%):  Is the front runner for the last two years. Fujimori, daughter of former President Alberto Fujimori (serving a prison sentence) is centre right. Mr. Fujimori is well known to Peruvians for his victory over the Shining Path guerrilla rebel organization and the hyperinflation extreme poverty period of the 90s. Keiko with a reputation as one to lead with a strong hand (something Peruvians are seeking) is the one to beat in the summer runoff.

Pedro Pablo Kuczynski (14%): Has a narrow lead for second place and if the election was today would be the top contender to take on Keiko Fujimori in the second round. A former Cabinet chief, finance minister and energy and mining minister from the 80s  with President Fernando Belaunde Terry and then again in the early 2000s under President Alejandro Toledo. He has strong ties to the United States, is independently wealthy and on record for promising to bring in $20 billion dollars of foreign investment to the mining industry over the next three years.

Alfredo Barnechea (9%): Is the moderate liberal in the race with a bias to the centre left. He comes with a background in journalism, was the host of many political TV interviews, wrote columns in magazines and a former congressman. He is challenging for second place as the one to break up the pro right duo of Fujimori and Kuczynski.

Veronica Mendoza (9%): Born and raised in Cusco, the ancestral capital of the Incan civilization. She speaks both Spanish and the native Incan language of Quechua. A strong left bias with a mandate to increase government spending by 50%, withdraw from free trade agreements and unearth the state planned economic model of the 80s. A former congresswoman of the current Humala administration who left the party in 2012 when it failed to live up to leftist campaign promises.

Alan Garcia (6%): Former President Garcia held power for two terms. It was in the second term of his administration that brought Peru to economic notability. With a far leaning right bias, Garcia with a focus to improving relations with business owners also was in the right place and time by taking advantage of a strong commodity cycle during the mid 2000s. With a poll reading of 6% he has a lot of ground to gain before April 10th.

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References: Peru Reports: (; Telesur (


PDAC 2016 Unleashes A Signal


Quite possibly since inception, the Prospectors & Developers Association of Canada (PDAC) has been recognized as the mining industry’s global kingpin. It is the place for industry participants to share corporate war stories with each other, meet-and-greet with investors and generally enjoy the camaraderie amongst colleagues and friends…almost akin to when a professional sports team heads out on a road trip bolstering and bonding its relationships. It’s a long conference lasting four days…which many are calling overkill…especially given the sorry state of attendance on the fourth day.

Still, following a 2015 of catastrophic investor interest in our sector, it’s safe to say that most of us went into PDAC 2016 with bated breath. Clearly, we were not surprised by the low level of company participation (booths beside us and across the aisle were both empty) as witnessed by the core shack immediately adjacent and on the same level as the investors exchange. This is a big deal as in years past this entire section was completely full with resource companies. The good news is that the “fluff” in our industry is finally starting to fall by the wayside and clear way for the best of the best. We’d say it’s long overdue… We are also happy to report that there is definitely a hint of a changing investor sentiment towards our beloved metal…gold…we don’t want to go as far by stating today the bear has finally lost its grip, but comparing to last year’s PDAC, there are certainly telling signs that we are nearing the return of the gold bull.

Buying The Blood in the Street or Battening Down the Hatches —- It is no secret our sector is in dire straits at this time. Given that there are still more negative outlooks and financial reports from the seniors on the way (more writedowns and credit downgrades) q1 earnings season is not going to be pretty. The question many are asking, is it a time for corporate “prevent style defence” or an opportunity to go “full court press offence” and take advantage of low pricing opportunities motivated by fear? Not surprisingly most of the mining seniors at the conference are playing defence…choosing safety first… bandaging war wounds and hunkering down. The giants in our industry are taking quite a beating and planning to weather the storm in 2016. What this tells us is not to expect any major headliner deals anytime soon. For the sake of the mining market, let us hope for these debt heavy behemoths that Goldman is proven incorrect on its nasty 2016 gold price prediction.

Soccer Rules in Peru…


Our understanding of the importance behind the game of soccer to Peruvians comes from the many years of building our business in Peru. The old ore processing plant, ‘Metalex’ at almost twenty years old now, has been witness to many of these key soccer matches, albeit on a much less favourable gravel and dirt playing condition. You can imagine how pleased we were when our construction contractor offered, at their expense, to build a brand new soccer pitch complete with stands at our new ‘Veta Dorada’ ore processing plant located near Chala, Peru. A first big tournament, to commemorate Dynacor’s grand opening event, is expected to take place in the late summer of 2016.