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Chile's mining sector, dominated by copper and lithium, contributes up to 14% of the national GDP and 58% of total exports. While the country is a global leader in copper production via the state-owned Codelco, it faces significant environmental challenges, particularly extreme water scarcity in the Antofagasta region where mining accounts for 50%–65% of regional water withdrawals. The sector is increasingly relying on desalination to meet demand. Socially, women's participation in the mining workforce remains low at 10%. Economically, Chile is pursuing a National Lithium Strategy to increase domestic value addition and public partnerships, while maintaining strong export ties, particularly with China.

The report examines the governance of copper and lithium in Chile, highlighting a significant gap between international sustainability principles and territorial realities. Through case studies in Tarapacá and Antofagasta, it identifies critical failures in indigenous participation, water management, and the equitable distribution of mining royalties. While the 2023 National Lithium Strategy is noted as a step toward state control and sustainability, the document argues that a just transition requires binding community participation, transparent fiscal management, and regional economic diversification to avoid reproducing historical extractivist inequalities.

The document reviews Chile's evolution toward a Just Socioecological Transition (JSET), highlighting the shift from energy-focused policies to a multi-dimensional approach. It identifies critical gaps in monitoring, funding, and legislative alignment while suggesting international mechanisms to support the 2025-2035 National Strategy.

The report identifies critical gaps in the implementation of mining laws in Chile, Colombia, and Peru, where energy transition mineral extraction often leads to human rights violations and environmental degradation. To address this, it proposes ten specific safeguards covering areas such as prior consultation, water rights, and the protection of environmental defenders. It advocates for a multi-level governance framework and international cooperation to ensure that the energy transition does not replicate historical extractivist patterns.

The proposal seeks USD 654,320 to address barriers in Chile's subnational climate action, specifically the lack of alignment between local and national instruments, limited technical capacity, and insufficient knowledge of climate finance. The project, implemented by the FAO over 24 months, focuses on training programs for regional and municipal officials, technical support for developing Regional Climate Change Action Plans (PARCCs), and a communication strategy to engage stakeholders and promote GCF funding.

The report outlines a holistic approach to watershed-level water management, emphasizing the need for risk-based planning, stakeholder engagement, and clear legal frameworks. It presents case studies from Mongolia, which utilizes a system of management zones based on water sources, and Antofagasta, Chile, which employs strategic regional planning and technical cost-benefit analyses. Both jurisdictions highlight the challenges of managing water in arid environments where mining competes with community and agricultural needs, particularly under the pressures of climate change.

The report advocates for watershed-scale water governance to balance the needs of the mining sector with those of other users and ecosystems. It details a framework based on risk planning, stakeholder collaboration, and continuous monitoring. In Mongolia, the focus is on integrating surface and groundwater management, particularly in the Gobi desert where mining demands may exceed supply by 2021. In Antofagasta, Chile, the study highlights the use of strategic regional plans and cost-benefit analyses for the Loa River basin, while noting the challenge of water rights assigned without expiration dates.

The document examines water governance in the mining sectors of Mongolia and Chile, advocating for a holistic, risk-based watershed approach. It details the legal frameworks, data collection strategies, and stakeholder engagement processes used in both jurisdictions to manage water scarcity and pollution risks, particularly in arid environments.