Quebec opposition parties take aim at foreign mining firms

 

Related Topics

 

Stocks

Cliffs Natural Resources Inc
CLF.N
$41.97
+0.33+0.79%
19:27:39 IDT
 
ArcelorMittal
ISPA.AS
€12.96
+0.25+2.01%
19:42:39 IDT
 
Lowe's Companies Inc
LOW.N
$26.55
+0.29+1.11%
19:43:18 IDT
 
 
Photographer and a strip club

Photographer and a strip club

A Reuters photojournalist visits a Florida strip club anticipating a surge in attendance during the week of the Republican National Convention. Slideshow

 

 
 

Mon Aug 20, 2012 8:15am IST

* Quebec opposition says foreign miners not paying enough

* Government has big plans to develop resource-rich North

By David Ljunggren

Aug 19 (Reuters) - Quebec's two main opposition parties, seeking to replace the struggling Liberal government in a Sept 4 election, said on Sunday that foreign mining firms should pay more for the right to operate in the resource-rich Canadian province.

Polls show the separatist Parti Quebecois is well ahead of Premier Jean Charest's Liberals, who are almost neck-and-neck with the right-leaning Coalition for the Future of Quebec (CAQ).

The government last year launched a C$80 billion ($81 billion) plan to develop Quebec's frozen northern regions, which it says has big deposits of nickel, cobalt, platinum group metals, zinc, iron ore, gold, lithium, vanadium and rare-earth metals.

Parti Quebecois leader Pauline Marois, appearing in a televised debate with Charest and CAQ leader Francois Legault, said if she won the election she would raise royalty rates to stop natural resources being sold off at a discount.

"We will really create wealth and share it for all the population, not only for a few mining firms," she said.

"I am for the development of the North, but not for development of the North which will let a few foreign mining firms enrich themselves."

Foreign firms already mining in Quebec or interested in taking part in mining projects include Cliffs Natural Resources Inc, Tata Steel Ltd, ArcelorMittal, Xstrata Plc and a unit of Wuhan Iron and Steel (Group) Corp

The Parti Quebecois - which wants to win power and then hold a referendum on breaking away from Canada - says it would impose a minimum 5 percent royalty rate on the gross value of all mining output.

It would also slap a 30 percent additional tax on all mining profits which exceeded a certain unspecified level.

Marois, noting that 10 of the 19 mining companies operating in Quebec currently pay no royalties at all, said she wanted half the royalties from all resource extraction to go towards paying down the province's large debt.

The Liberals say that hiking royalty rates too far would deter foreign companies from operating in Quebec.

"We're in a good space when it comes to royalties and taxes," Charest said during the debate.

Legault's newly created CAQ, which has yet to contest an election, is promising to set up a C$5 billion natural resources fund that would be used to take minority stakes in mining projects. This, says the party, would allow Quebecers to benefit directly from natural resource extraction.

"We need ... to stop giving our natural resources to foreign companies," Legault said during the debate. He said the CAQ wanted all royalties from non-renewable resource extraction to go towards paying down the debt.

During the two-hour televised debate - an often noisy and confusing affair that also included the leader of a smaller opposition party - Marois and Legault accused Charest of not standing up for Quebec enough.

Both the Parti Quebecois and the CAQ say they will do more to fight foreign takeovers of firms based in Quebec, such as the recent attempt by U.S. home-improvement retailer Lowe's Cos Inc to buy Rona Inc.