Kast and Quiroz’s Maneuver: The Inflated Figures of Codelco as a Pretext for Copper Privatization

Original article: La maniobra de Kast y Quiroz: Las cifras infladas de Codelco como pretexto para privatizar el cobre

By Leopoldo Lavín Mujica

On Thursday, November 5, during Codelco’s shareholders meeting, which is wholly owned by the State, the board revealed that the production figures for 2024 and 2025 had been inflated by 42,100 tons.

Chairman Bernardo Fontaine, a proponent of neoliberal policies—former vice president of Citibank Chile, leader of the «Not with My Money» campaign defending pension fund managers, and spokesperson for the rejection campaign in 2022—pointed fingers at the previous administration led by Máximo Pacheco, board chairman, and Rubén Alvarado, executive president.

Director Alfredo Moreno, also affiliated with the right—having served as chancellor and minister under Sebastián Piñera, and former president of the Confederación de la Producción y del Comercio (CPC), the apex of large businesses, appointed to the board by Gabriel Boric in 2025 and retained by Kast’s government—stated that «apparently,» management and operational control personnel were involved; the former budgeting and management control manager, César Márquez, was terminated in May.

Investigations are still ongoing. Finance Minister Jorge Quiroz expressed being «very, very concerned» that the «deception» reached «such heights,» concluding that alternative mechanisms may need to be considered in some divisions, particularly in their large mines, and possibly involving private capital.

The Copper Workers’ Federation had already warned in July that it would not accept the use of Codelco in political discourse, firmly opposing its privatization with a «categorical and absolute rejection.»

Ana Lamas, president of the Copper Workers’ Confederation, which represents workers from contracting companies, warned in August that privatizing would be the «final blow» to nationalization efforts.

Codelco was established in 1976 from the mines nationalized unanimously by Congress in 1971, which were seized from American companies Anaconda and Kennecott. The dictatorship of Augusto Pinochet did not sell it; the Reserved Copper Law allocated 10% of its foreign sales to the Armed Forces.

For decades, Codelco channeled nearly all its profits to the treasury, often needing to incur debts to invest. This has led to a debt accumulation exceeding $25 billion. Aldo Binimelliz, secretary general of the Copper Workers’ Federation, succinctly noted: «all governments have followed the trend of merely extracting money from Codelco.»

While the inflated production figures are severe, it is important to measure them: approximately 21,000 tons per year, representing less than 2% of total production. The accounting impact could reach up to $140 million, which pales in comparison to what Codelco contributed to the treasury in 2025.

Codelco director Ricardo Álvarez recalled the «intense pressure» from Máximo Pacheco, the board president during Gabriel Boric’s presidency, to meet the production target. The figures remain preliminary: auditors KPMG and EY are still reviewing the accounts.

The issue first emerged in January, under Pacheco’s administration: «the third line of defense» functioned, stated director Eduardo Bitrán. The inflated figures were not fabricated by the government, nor did the current administration discover them.

Nonetheless, such inflated figures cannot serve as an excuse to sell Codelco. The crucial question remains: why divest Codelco to private entities at a time of soaring global copper prices?

According to «Le Monde,» the price of copper has increased nearly 30% in the past year, and the International Energy Agency predicts that demand will exceed supply by 25% by 2035.

Sebastián Claro, former vice president of the Central Bank, announces an incoming «high copper price cycle.» Selling now would mean forfeiting that revenue while doing so amid a reputation crisis would be reckless.

The government assures that the State will retain control: Quiroz stated in July that Codelco «will never cease to be a state-controlled company.» However, control diminishes with fragmentation.

The joint minister of Economy and Mining, Daniel Mas, seeks to sell «non-essential» assets. Fontaine, who has chaired the board since May, will review «structural changes» in 2027. A government-backed project aims to remove worker representatives from the board.

«Alternative mechanisms,» «private capital spaces,» «non-essential assets,» «structural changes»: these are four euphemisms for one term that no one in the government is willing to utter: privatization.

Why the rush? Because time is not on the government’s side.

According to Criteria, on November 1, Kast had merely 25% approval and 65% disapproval, his lowest figures since taking office in March. By the end of July, the pollster Descifra recorded that 75% of Chileans want Codelco to remain 100% state-owned.

Without public backing, the government hurries to execute a maneuver that can only benefit the mining oligarchy—both domestic and foreign—before the electoral process prevents it.

No one has said who would buy Codelco. The likely candidates are the giants already operating in Chile: BHP, Anglo American, Glencore, or the American Freeport-McMoRan, which owns 51% of El Abra, with Codelco as a partner. At home, the Luksic Group controls 65% of Antofagasta Plc, which owns Los Pelambres and Centinela, and their wealth is the largest in Chile, according to Forbes. Much of this fortune is derived from copper revenues turned into family wealth.

Communist deputy Luis Cuello demands to know «what interests are at play.» When public assets are sold piecemeal and without debate, the scent of corruption is not baseless: it echoes the privatizations of the dictatorship in the 1980s.

This concern isn’t limited to the left. The Chile Vamos coalition also expressed opposition to privatizing Codelco in July. Mining consultant Juan Ignacio Guzmán believes that selling now would be «a political and economic mistake.» Óscar Landerretche, a socialist and former Codelco president, defender of the previous management, cautioned in April that the government was preparing to «justify the privatization of a portion» of Codelco.

Our thesis is clear: inflated production figures necessitate increased public oversight, not less state involvement. From what we understand, those responsible lie within management, not among the miners.

Selling divisions to private interests would mean granting them the benefits of a booming market while leaving the state with the debt, the tailings, and the aging deposits.

The government talks about establishing order. In tumultuous times, with Washington and Beijing vying for critical minerals and tariffs changing month to month, true order equates to economic sovereignty: the ability of a nation to decide what to do with its primary wealth.

Economist Manuel Riesco asserted in June that protecting Codelco is «a paramount national security issue.» Thus, safeguarding it is a bare minimum.

A left-wing agenda should go even further and renew efforts for the renationalization of copper, which the 1982 mining law perpetuated in private hands, with three-quarters of production now outside state control.

This will not be accomplished by a single minister; it requires a mobilized populace ready to defend what Salvador Allende termed «the salary of Chile,» not the profits of multinational copper companies or the billions amassed by the Luksic family.

Not from nostalgia for 1971, but based on facts: between 1988 and 2018, according to economist Benjamín Leiva, nine large mining companies retained nearly 60% of the copper revenues.

Economist and lawyer Julián Alcayaga posits that if the Constitution grants the State absolute control over mines, a decree suffices to reclaim concessions without compensation. Other legal scholars contend that the 1982 law mandates payment based on present value of future profits. This is the debate Quiroz avoids opening.

A democratic solution exists: a Copper Oversight Council. Unlike the Chilean Copper Commission, which answers to the current government, this would be autonomous: geologists, auditors, economists from public universities, representatives of workers, and mining communities, selected through a competitive process and ratified by the Senate. It would have access to all information, publish reports, and its approval would be required for asset sales or partnerships.

And a political demand: that no Codelco division, nor any stake, be sold or handed over to private entities without a law passed by Congress. If the government insists on altering the Constitution, as Quiroz admits might be necessary, let it be subjected to a public plebiscite.

In 1971, Chile decided who owns the copper. If the minister believes that answer has changed, he should have the courage to ask the Chilean people once more.

Leopoldo Lavín Mujica