Even as controversy persists over the extent to which gold mined in Guyana is smuggled abroad through neighbouring countries, figures recently compiled by the Guyana Geology & Mines Commission (GGMC) indicate that gold declaration for January this year reached 94.6 per cent of what was officially projected. Against the backdrop of skepticism expressed by mining sector officials as to whether the figure released by the GGMC matches actual gold production for the period, the state-run mining administration body has released a declaration figure of 35,947.14 ounces for January this year.
In January, Natural Resources and Environment Minister Raphael Trotman had raised eyebrows when he announced that approximately 15,000 ounces of gold are being smuggled out of Guyana weekly, a figure that could represent up to 60 per cent of the country’s overall gold production. Trotman said then that the gold was being moved illegally to Brazil and Suriname then through airports in North America and Europe to locations as far as the Middle East.
Trotman had provided the figure in response to a question raised by the Stabroek News at a press conference earlier this year, though the body representing some miners in the sector had subsequently dismissed that figure as “ridiculous.” The Guyana Gold & Diamond Miners Association (GGDMA) had conceded that smuggling is occurring but had said that it had found it difficult to fathom that 15,000 ounces were being smuggled out of the country each week, a figure which, if accurate, could amount to around double the average annual declaration in recent years.
Government is yet to respond to a call from the GGMC for “more details” to be made available on the origin of its smuggling figures being touted though it is known that an investigation involving the United States government is now ensuing into gold smuggling out of Guyana.
The persistent shortfall in projected gold declaration is widely believed to be attributable to increased smuggling, a practice which the GGMC has seemingly been unable to halt. In 2014 an official estimate for the first five months of the year had provided a figure of about US$100 million in foreign currency earnings and around $1.5 billion in taxes and royalties relating to losses to the country’s economy arising out of declining gold declaration.
Mining sources have told Stabroek Business that the pace of progress in the granting of concessions that will ease the pressure of the sector resulting from a protracted period of declining prices has been slow and while the GGDMA has said that it is on board with government in seeking to staunch the illegal flow of gold out of the country, small miners say that concessions to the sector, including, crucially, access to cheaper fuel are likely to increase gold production and declaration and might, along with more effective official policing, even have the effect of reducing the extent of gold smuggling.
Trotman is on record as saying that this year the Government of Guyana will continue to reassess the issue of mining concessions not only to provide further incentives for miners to increase gold declaration but also to ensure that mining operations are consistent with the laws of Guyana. Official efforts in this regard will include work by the Anti-Gold Smuggling Task Force to close loopholes that facilitate gold smuggling and other illegal practices in the industry.
While the gold declaration figure for January could put the industry on track to break last year’s annual production record, a full year of production by the international mining companies means that significantly higher gold declarations are expected at the end of this year.
