As the US and its partners race to counter China’s grip on critical minerals, Australia and its allies risk mistaking regulatory speed for strategic security. Throughout Latin America, the evidence continues to show that while permits might open mines, it’s community consent that determines whether they stay open.
China has spent decades concentrating critical mineral supply chains under its control. The United States and its partners are trying to break that hold within years. That urgency and competition risks countries wrongly concluding that the only way to secure critical minerals, and the advanced technologies they are necessary for, is to override community interest for the national interest. While regulatory timelines for mines must be streamlined, pursuing this to the exclusion of community consent will only result in civil opposition to the critical mineral agenda. A mine that opens a few years earlier only to shut down due to protests is not a strategic capability; it is a stranded one.
As political urgency drives faster approvals, the evidence points to a direct correlation with higher rates of community conflict, environmental harm, and human rights concerns. In 2025, the Business and Human Rights Centre recorded a 73 per cent year-on-year increase in allegations of human rights breaches against the mines it tracks, with South America the primary region.
Legitimacy Risks
Human rights violations are not only a moral failure but a strategic vulnerability. Legitimacy failures destroy projects. Legitimacy risk is the risk that a project loses the community consent that it needs to operate. It is distinct from regulatory compliance, meaning a project can hold every permit and still lose the consent of the communities around it. Human rights allegations and resulting organised opposition are symptoms of that erosion, and when the community’s permission collapses, so does the ability to operate.
Spektrum Development’s modelling of legitimacy risk across 50 critical minerals projects worth US$370.6 billion found that US$234.9 billion, around 63 per cent of the total value, was exposed to legitimacy risk. This problem cannot be legislated away. Political override of community opposition only served to worsen outcomes in 98 per cent of cases.
Consider First Quantum’s Cobre Panama. In 2022, the mine generated almost 5 per cent of Panama’s GDP and produced 350,000 tonnes of copper. It employed 40,800 people – nearly 2 per cent of Panama’s workforce. Yet the loss of community support brought operations grinding to a halt.
The crisis began when a new contract granting First Quantum long-term operating rights was signed in October 2023. Days later, widespread protests argued the deal included inadequate royalty provisions, excluded environmental safeguards, and compromised national sovereignty. Panama’s Supreme Court voided the contract as unconstitutional the next month. In June 2026, an independent audit found compliance approaching 88 per cent across 370 legal, fiscal, environmental and operational commitments. Despite this, there remains strong opposition to resuming operations. Regulatory compliance will not resolve this issue. Community consent might.
Compare this with Anglo American’s Quellaveco in Peru, which faced years of opposition due to scarce water. Structured dialogue changed its trajectory and built consent, producing 26 commitments on water, environment and social investment. Online since 2022, the mine contributes over 10 per cent of Peru’s copper, with annual capacity of 300,000 tonnes and potential to supply for 36 years. Quellaveco also shows consent must be maintained. With delivery of some of Anglo American’s commitments being contested, tensions have re-emerged. Consent is not a construction-phase purchase but rather requires sustained effort and engagement.
The lesson is clear. Community consent is essential, and its maintenance is a constant process. These failures were not caused by great-power competition. But they show what that competition risks provoking. If the United States and its partners try to break China’s grip by compressing approvals, without regard for the consent this could override, they will manufacture the very failures that closed Panama and now threaten to erode Quellaveco’s support.
Australian Legitimacy in South America
Deeply embedded in Latin American mining, Australia needs to integrate this lesson into its operations and strategy, evaluating its own critical mineral supply chains and navigating the region’s changing administrations and demands for community consent.
In Argentina, Rio Tinto has committed US$2.5 billion to its Rincon lithium project, backed by Export Finance Australia, and secured a joint venture with Chile’s state mining company ENAMI to develop the Salares Altoandinos lithium project. In Chile, BHP operates Pampa Norte and Escondida, the world’s largest copper mine, and holds a significant stake in Antamina, one of Peru’s largest copper operations. In Brazil, Meteoric Resources, a leading Australian exploration company, is advancing the world’s largest ionic clay rare earth deposit.
This creates a shared responsibility for the Australian Government and industry to engage regional governments and communities to address concerns and maintain Australia’s position as a trusted partner. This matters now more than ever. Incoming administrations in Colombia and Peru, upcoming elections in Brazil, and the potential for President Paz’s forced resignation in Bolivia mean agendas governing regional resource powerhouses are shifting rapidly. With right-wing candidates Fujimori in Peru and de la Espriella in Colombia winning on platforms of deregulation and faster mining approvals, and Flávio Bolsonaro looking competitive in Brazil, it is tempting to conclude that industry could soon accelerate projects at the expense of community consent.
This fails to account for the region’s continued demand for economic inclusion, democratic empowerment, and Indigenous rights. In Peru and Colombia, both candidates won by about one per cent, and there remains public support for holding mining companies accountable and maintaining environmental protections. Fujimori’s policies even include profit-reinvestment tax incentives designed to keep capital inside Peru and a redirection of 40 per cent of royalties to host communities. The Australian Government and industry need to coordinate now to navigate these dynamics.
Diplomacy & Development
Australia has embassies across the region from Bogotá to Buenos Aires. The Australian Government needs to leverage these networks to do three things. First, track shifting political agendas and advise industry on the geopolitical dynamics that will determine project viability in each jurisdiction. Second, advocate with host governments for business-enabling frameworks that balance investor certainty with the community and environmental standards that legitimate projects require. Third, demonstrate Australia’s value as a development partner — not just an extractor — by connecting its mining engagement to broader economic growth, infrastructure, and skills development in host countries.
For its part, industry cannot rely on regulatory reform to resolve every issue. Compliance alone will not deliver consent, and legality should not be confused with legitimacy. Industry needs to understand whose consent is needed, whether landowners, Indigenous communities, or small-scale and informal miners. It must engage concerns early rather than in response to opposition, making commitments that are verifiable and upheld. The companies that do this well build the trust that transforms a regulatory approval into a community’s permission to operate.
Australia must streamline processes for bringing mines online — but not at the expense of the standards they were designed to uphold. If it wants to maintain its competitive advantage in Latin America, Australia must build projects that communities and partners trust to last. That takes government and industry working together, and it is how Australia protects the investments it has already made and secures the partnerships it still needs.
David Saultry is an independent consultant specialising in economic security and critical minerals, previously advising on US-China strategic competition at the Australian Department of the Prime Minister and Cabinet and the Department of Foreign Affairs and Trade.
This article is published under a Creative Commons License and may be republished with attribution.
