Venezuela’s numerous artisanal miners in the country’s El Callao mining region are coming under increasing pressure from the political administration in Caracas which, reportedly, has been ‘cutting’ deals with bigger gold mining operations that allow for a larger share of the returns from those operations to accrue to the government but progressively reduce the earnings of the small miners.
A September 12 Reuters report stated that large numbers of artisanal miners who have long been selling the gold they recovered to the government have, over the past year, had to leave the area on account of their inability to easily secure supplies with which to pursue their gold recovery operations. The difficulty in securing supplies is said to be linked to a wider initiative to ‘squeeze out’ the small miners so that more lucrative deals can be struck to afford the country’s treasury a bigger share of the returns from gold mining operations.
The Reuters report says with gold production having stagnated since the 2011 nationalization of the sector, the authorities in Caracas are now aiming to ramp up production by building “strategic alliances with select private companies.” These current “partnerships” between the Venezuelan government and the bigger miners, the Reuters report says, “are forcing out informal miners in places like El Callao, in the country’s south.” Reuters says that these reports were confirmed by “businessmen, government officials and miners.” The report also quotes Alexis Chauran, a director of an association of gold miners in La Ramona in eastern Venezuela, near the Brazilian border, as confirming that the Venezuelan government was indeed using those measures to increase the state’s returns from the gold mining sector.
Venezuela has reportedly gone even further in its efforts to realise a greater share of the returns from the gold mining industry to the state treasury. The Reuters reports says that Caracas has green-lighted the establishment of twelve privately operated processing plants which it says are using sophisticated equipment to extract gold-bearing sand from nearby mines. Most of these mills are reportedly already up and running. Financial troubles had earlier compelled the Maduro administration to sell off some of its existing central bank gold reserves even as Venezuela’s crude oil exports were taking a battering from US sanctions, Reuters says. The News Agency also cited data on the Bank’s website as confirming that the country’s gold reserves had fallen by 60 tonnes in four years and are now at their lowest in five decades.
