Mineral and Metals Potential Beyond Gold as Central America Suffers Skills Drain

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Researched by Indistrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). In the Central American and Caribbean region, Trinidad and Tobago runs away with the top GDP (gross domestic product) growth spot moving from 6.3% in 2005 to 10.1% forecast for 2006, due mainly to liquefied natural gas (LNG) and other energy exports. The country has a history of industrial development and this environment, in addition to its resources has made the country (two islands) an investment target. Population topping one million, it has a per capita GDP equivalent to $10,000 per annum. Many petrochemical and energy companies have newly planned projects, as do metals companies taking advantage of the low cost energy and chemical feedstocks.

Guatemala, with a GDP growth rate moving up to 3.5% in 2006, continues to develop manufacturing capacity and export products to greater Central America. The country’s mineral resources are unexploited and largely unexplored in terms of potential for gold silver, chromium, molybdenum and nickel. Clay, sand and limestone deposits could feed construction supplies production and other stones and base metals are in evidence.

Many countries in the region are seeing Canadian and North American companies lead the way in exploration and mine development in the gold sector, with Glencairn and Vanessa in Costa Rica, Desert Sun in El Salvador, Doublestar in Honduras, Jaguar, Goldex and Skye are also active in the region. The new gold mining infrastructure could afford a base for the extension of exploration and exploitation to other minerals.

El Salvador is looking at a 3% GDP growth in 2006, Honduras 4.5%, Nicaragua 4%, Costa Rica down to 2.7% and Panama moving up to 4%.

The region is in a threatening hurricane zone and many of the countries have social and political systems still hovering in the fragile and volatile state. A World Bank study released in the fourth quarter of 2005 reported that many Central American and Caribbean nations had more than 50% of their university educated citizens living abroad. 89% of skilled workers in Guyana leave the country. In Jamaica the rate is 85% and in Haiti 47%.

In terms of the money remitted back to countries, Guatemala is cited as an example of the incoming cash reducing the severity of poverty where remittances make up more than 50% of the income of the poorest 10% of families. But the benefit of this income is outweighed by the loss of people with talent and drive who are essential for building institutions and their loss can have severe consequences, says the World Bank study. This is another factor keeping the poorer countries bouncing along the runway in ground effect while struggling to attain real economic lift-off.

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