By Catalino Hoyos | 2025-05-06

QUITO -- Chinese financing of the Mirador open-pit mine in Ecuador's southern Amazon is enabling a predatory model of development that, according to a recent report, has led to land dispossession, community intimidation and other forms of violence.

The report, released in February by the Cordillera del Cóndor Mirador Amazonian Community of Social Action (CASCOMI) and the Sustainable Latin America Alliance, highlights alleged irregularities in the funding provided by Chinese state-owned banks to mining and construction firms operating in the region.

The Mirador project, launched in the 2010s during the presidency of Rafael Correa (2007–2017), is run by Ecuacorriente, a subsidiary of the Chinese consortium CRCC-Tongguan, comprising China Railway Construction Corporation (CRCC) and Tongling Nonferrous Metals Group Holdings.

Titled "Situation of Environmental Defenders and Responsibilities of Chinese Banks in the Mirador Mining Project," the report links at least five Chinese state-owned financial institutions to serious environmental and human rights violations in Zamora Chinchipe, an Amazonian province bordering Peru.

The banks, including China Development Bank, Export-Import Bank of China, Bank of China and Industrial and Commercial Bank of China, have financed the CRCC-Tongguan consortium without imposing clear environmental or social safeguards, despite repeated warnings from affected communities and international watchdogs, the authors say.

Impunity and over-indebtedness

Between 2007 and 2017, Chinese state-owned banks emerged as major financiers of energy and infrastructure projects across Latin America, often with few safeguards or little oversight.

The Mirador open-pit mine in southern Ecuador received direct financing from at least five Chinese banks through five separate transactions, as detailed in CRCC's annual reports from 2009 to 2024, the study says.

Between 2010 and 2020, the CRCC-Tongguan consortium secured five loans to acquire, develop and expand the Mirador project.

The first two were syndicated loans totaling $1.62 billion, $329 million in 2010 and $1.29 billion in 2014, granted by China Development Bank, Bank of China and the Bank of Communications.

In 2015, the Export-Import Bank of China extended an additional $144 million loan. In 2019, Huishang Bank provided an additional $300 million, coinciding with the start of the copper concentrate production phase at the Mirador mining project.

Bank of China's Panama branch issued a $200 million loan in 2020, the only one directed specifically to the Ecuadorian subsidiary Ecuacorriente S.A., which remains active and is due to mature in July.

All other loans expired between 2015 and 2024, but the CASCOMI report warns that the debt burden and lack of enforceable environmental standards continue to expose local communities to long-term risks.

Opacity

Secrecy has surrounded nearly every stage of the Mirador mining project.

According to the investigation, the Chinese banks financing the project, all influenced or controlled by the Chinese government, have failed to publish loan contracts or disclose applicable oversight mechanisms, in violation of both their institutional commitments and international transparency standards.

Environmental defenders have accused the Chinese consortium operating the mine of widespread illegal and unethical practices, including land dispossession, forced evictions, labor abuses, destruction of community infrastructure, intimidation, and manipulation of administrative and judicial processes.

Far from isolated incidents, the report characterizes these actions as part of a systematic pattern of aggression, co-optation and corruption that has deeply damaged the region's social fabric.

"Chinese banks have not only financed a mine; they have financed a pattern of systematic violence against those who protect ecosystems and collective rights," said one of the report's authors, who requested anonymity because of security concerns.

Despite this record, Chinese financing has continued to flow.

The banks' lack of due diligence enabled the violence to persist, even after earlier loans had expired, the report says.

Chinese banks turn their backs

In January 2024, during the United Nations' Universal Periodic Review, China accepted recommendations to strengthen protection for human rights defenders. But the situation at Ecuador's Mirador mining project tells a different story.

According to a new report, the Chinese banks financing the project have disregarded requests for transparency, failed to adopt policies on public access to information and remained silent in the face of documented repression and criminalization of environmental defenders.

This willful inaction violates the principles of responsible financial governance, say analysts.

Instead of heeding calls for reform, the banks are reportedly considering new loans to expand the Mirador mine's output from 60,000 to 140,000 tons of ore per day, a move that would place additional stress on the Tundayme tailing dam, already flagged as a high-risk structure.

The report calls for the immediate publication of all loan contracts, the creation of an independent investigative commission and a suspension of future financing to the CRCC-Tongguan consortium.

It also urges Chinese banks to compensate affected communities, improve their environmental and social oversight and take responsibility for the long-term damage caused by their inaction.