Gold mining in Brazil’s Amazon region shows 90% increase, raises concerns

A recent study by Instituto Escolhas reveals that gold mining in Brazil’s Amazon region has witnessed a staggering growth of over 90% in eight years.

The area dedicated to mining has expanded from 79,200 hectares in 2013 to 151,700 hectares in 2021.

The report attributes this surge to a series of legal facilitations enacted over the years, notably Law 12,844 of 2013.

This law relieved gold-buying companies from verifying the gold’s legal origin, instead requiring only handwritten forms filled out by sellers, thus hindering the identification of illicitly obtained gold and impeding efforts to combat money laundering.

The study highlights that the assumption behind this law was that gold mining is an individual and small-scale activity.

However, it reveals that Amazonian garimpos, the informal mining sites, operate with significant investments and generate substantial financial profits.

To establish a mining area, approximately 3.3 million reais are needed for machinery and infrastructure.

Gold mining can yield a monthly profitability of 1.1 million reais, with profits reaching 632,000 reais per month.

In the Itaituba region of Pará, the largest gold producer in Brazil, mines typically involve around 18 workers who extract an average of 3.75 kilograms of gold per month.

The study also exposes the issue of illegality in the gold trade.

Another report from Instituto Escolhas indicates that between 2015 and 2020, Brazil traded 229 tons of gold, nearly half of which (47%) showed indications of being obtained illegally. Approximately 54% of this gold originated from the Amazon region.

A third of the suspect gold was purchased by four companies, two of which are already under investigation by the Federal Ministry of State.

In April of this year, the Federal Supreme Court overturned the presumption of good faith for gold buyers, stressing the need for a new regulatory framework that requires proof of origin within 90 days.

Considering the alarming growth of gold mining in the Amazon, the study concludes that stricter regulation is imperative.

It calls for establishing extraction limits and rigorous environmental licensing to curb the uncontrolled expansion of mining activities.

The document emphasizes the serious implications that this unchecked growth has on forest preservation, human health, and the rights of affected communities.