Peru: Andean villagers struggle with modern life in shiny new town built for them by mining company

The remote town of Nueva Fuerabamba in Peru's southern Andes was supposed to serve as a model for how companies can help communities uprooted by mining. Built to house around 1,600 people who gave up their rural village to make room for a massive, open-pit copper mine, the new town boasts paved streets and modern houses with electricity and indoor plumbing, once luxuries to the indigenous Quechua-speaking people who now call this place home.

The mine's operator, MMG Ltd, the Melbourne-based unit of state-owned China Minmetals Corp, threw in jobs and enough cash so that some residents no longer have to work. However, the high-profile deal has not brought the harmony sought by villagers or MMG.

Nueva Fuerabamba was at the centre of one of the most generous mining settlements ever negotiated in Peru. But three years after moving in, Reuters interviews with two dozen residents show that many are struggling with suburban life and its supposed conveniences. They miss their old lives growing potatoes and raising livestock. Some have squandered their cash settlements. Idleness and isolation have dulled the spirits of a people whose ancestors were feared cattle rustlers.

MMG inherited the Nueva Fuerabamba project when it bought Las Bambas from Switzerland's Glencore Plc in 2014 for £5.2bn. Under terms of a deal struck in 2009 and reviewed by Reuters, villagers voted to trade their existing homes and farmland for houses in a new community. Heads of each household, about 500 in all, were promised mining jobs. University scholarships would be given to their children. Residents were to receive new land for farming and grazing, albeit in a plot four hours away by car. Amenities include a hospital, football fields and a cement bull ring for festivals.

Cash was an added sweetener. Villagers say each household got 400,000 soles (about £92,000), which amounts to a lifetime's earnings for a minimum-wage worker in Peru. MMG declined to confirm the payments, saying its agreements are confidential.

However, some residents say the deal has not been the windfall they hoped. Many no longer plant crops or tend livestock because their replacement plots are too far away. Jobs provided by MMG mostly involve maintaining the town because most residents lack the skills to work in a modern mine.

Their new two-and-three storey houses are draughty and seem flimsy compared to their old thatched-roof adobe cottages heated by wood-fired stoves, some said. Now basics like water, food and fuel – once provided by the land – must be paid for. "Everything is money," Margot Portilla, 20, told Reuters. "Before we could make a fire for cooking with cow dung. Now we have to buy gas."

Camilo Leon, a mining resettlement specialist at the Pontifical Catholic University of Peru, says subsistence farmers have struggled to adapt to the loss of their traditions and the "very urban, very organised" layout of planned towns. "It is generally a shock for rural communities," Leon said.

"It is like we are trapped in a jail, in a cage where little animals are kept," said Cipriano Lima, 43, a former farmer.

Many villagers spent their settlements unwisely, said community president Alfonso Vargas. "Some invested in businesses but others did not. They went drinking," he said.

The streets of Nueva Fuerabamba were virtually deserted when Reuters visited on a weekday. Vargas said many residents have returned to the countryside or sought work elsewhere. Alcoholism, fuelled by idle time and settlement money, is on the rise, he said.

Some villagers have committed suicide. Over the 12 months through July, four residents killed themselves by taking farming chemicals, according to the provincial district attorney's office. It could not provide data on suicides in the old village of Fuerabamba. MMG, citing an "independent" study done prior to the relocation, said the community previously suffered from high rates of domestic violence, alcoholism, illiteracy and poverty.

While the company considers the new town a success, it acknowledged the transition has not been easy for all. "Connection to land, livelihood restoration and simple adaptation to new living conditions remain a challenge," MMG said.

The company said most have benefited from improved housing, healthcare and education. "Nueva Fuerabamba has experienced significant positive change," Troy Hey, MMG's executive general manager of stakeholder relations, said in an email to Reuters. MMG said it spent "hundreds of millions" on the relocation effort.

Some residents said they have benefited from the move. The new town is cleaner than the old village, said Betsabe Mendoza, 25. She invested her settlement in a metalworking business in a bigger town. Portilla acknowledged her younger sisters are getting a better education than she did.

Nueva Fuerabamba residents continue pressuring the company for additional assistance. Demands include more jobs and deeds to their houses, which have yet to be delivered because of bureaucratic delays, said Godofredo Huamani, the community's lawyer. MMG said it stays apace of community needs through town hall meetings and has representatives on hand to field complaints.

While villagers fret about the future, many cling to the past. Flora Huamani, 39, a mother of four girls, recalled how women used to get together to weave wool from their own sheep into the embroidered black dresses they wear. "Those were our traditions," said Huamani from a bench in her walled front yard. "Now our tradition is meeting after meeting after meeting" to discuss the community's problems.

(Reuters report by Mitra Taj, with photos by Mariana Bazo.)