NACLA Review of Blood of Extraction

Blood of Extraction
Canadian Imperialism in Latin America

By Todd Gordon and Jeffery R. Webber  

While the involvement of Canadian firms in the mining sector in Latin America has received significant critical attention over the last decade, the wider impact of Canadian capital on the region has been largely overlooked. The involvement of the Canadian state in Latin America’s political economy has also received little scholarly attention. Blood of Extraction improves our understanding of these issues by providing a detailed analysis of Canadian political and economic engagement in Latin America, focusing on Central America and the Andean region. The book shows that Canadian private investment cannot be viewed in isolation from Canadian foreign and development policies and makes a strong case to understand this orchestrated intervention as a form of imperialism. Coming at a time of growing political uncertainty in Latin America, the volume provides a useful reminder that the future of the region will not only be shaped by the outcomes of domestic struggles, but also through the interventions of overseas actors.

The book starts by tracing the evolution of the theory of imperialism, showing how understanding of the concept has shifted from direct territorial control of peoples and regions to indirect control through economic, political, and military domination. The world economy is theorized as a structurally unequal system that favors the generation of profits and accumulation of capital within its core. The authors claim that this “involves the draining of the wealth and resources of poorer countries to the benefit of capital of the Global North, at the cost of the majority of the peoples of the Global South” (p. 7). Hence, the possibility of foreign direct investment leading to broad-based socioeconomic development in Latin America by boosting government revenues, creating formal sector employment, and transferring technology is rejected.

The remainder of the book is dedicated to the empirical investigation of Canadian capital in Latin America from this theoretical perspective. Evidence comes from a range of sources, including interviews with Latin American activists, numerous official Canadian documents secured through access to information requests, and a wide range of secondary source materials in Spanish and English. Six chapters are dedicated to individual countries while two chapters cover broader political issues in Central America and the Andes. While the analysis focuses on the neoliberal phase of capitalist development in Latin America, the authors place the cases in historical perspective, which ensures that “neoliberalism” is not given too much explanatory power.

Several important points emerge from Gordon and Webber’s analysis. The degree of influence the Canadian state and capital have exerted over national economic laws and policies in Latin America is revealed. Perhaps the clearest proof of this comes from Honduras where the authors show how the Canadian state and Canadian firms worked together to establish a favorable investment climate in the aftermath of the 2009 coup that removed Manuel Zelaya from office. The chapter shows how particular effort was invested into influencing the design of a controversial new mining law, which was introduced in 2013. Evidence is also presented to indicate that the coup facilitated Canadian investment in environmentally destructive tourist projects, enabled Canadian manufacturers to flout labor regulations, and paved the way for the completion of a free trade agreement between Canada and Honduras. A similar picture emerges elsewhere in Latin America, with Canadian state agencies and private companies exerting influence over laws and policies and pushing for free trade agreements to expand overseas markets and give greater assurances over investments.

Latin American governments have performed a varied role in this process, ranging from collusion and engagement (e.g. Peru) to suspicion and hostility (e.g. Venezuela). Ecuador sits between these two extremes as the governments of Rafael Correa have coveted Canadian capital but not bowed to its every demand. Since the introduction of a new mining law in 2009, his governments have steadily improved conditions for mining firms by loosening regulations, offering fresh financial incentives, and simplifying the country’s mining bureaucracy. The authors show that Canadian agencies and enterprises have played a crucial role in this shift. Yet Canadian mining companies operating in the country still face a moderately less favorable regulatory and tax environment than in most other Latin American nations. Hence, the book shows that Latin American states have the potential to attract and protect—as well as regulate and frustrate—overseas capital.

Finally, Blood of Extraction casts fresh light on communal and social mobilization in Latin America by analyzing a large number of conflicts related to Canadian investment and reporting the voices of activists involved in these struggles. Insight is also given into the tactics communities, organizations, and movements have used to challenge capitalist expansion and exploitation in the region, including holding local referendums on mining operations. These direct forms of local democracy contrast sharply with the state organized consultations that Latin American governments have used to manufacture consent for laws, policies, and projects.

While the book’s empirical range is impressive, its theoretical contribution is limited. The authors clearly did not set out to contribute to theoretical debates over imperialism. Yet the empirical cases presented in the book provide a strong foundation to draw out theoretical insights. Improving our understanding of imperialism is particularly important as we need a framework that more accurately captures changes in global economic power, interactions between national and foreign capital, and economic and political relations between countries and regions in the Global South.

Readers with interest in political economy, policymaking, democracy, and social movements will find a great deal of interest in Gordon and Webber’s Blood of Extraction. I congratulate the authors for writing a carefully researched book which makes an important contribution to our understanding of Latin America’s political economy at a crucial stage in its history.

— Jeff Goodwin, NACLA, March 2017

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