Venezuela and the Geo-Ecopolitics of Gold

The following is the second part of Teran’s two-part series on geo-ecopolitics. The first part addressed the geo-ecopolitics of oil.

Although gold is a commodity of very high value in the global capitalist system, it has been oil which has decisively marked Venezuela’s contemporary history.

However, as is well known, the country which was built around crude oil today finds itself in the midst of the worst crisis in its history, with a collapsed economy treading water in all sectors.

The breakdown of the oil-based Venezuela is causing a revaluation of other commodities and is generating the emergence of new scenarios and forms of dispute over the natural resources in the country.

In this complex context, gold is of crucial importance.

As early as the 1990s, when the effects of the economic debacle that began in the 1980s were felt, this metal was identified as one of the main [financial] reserves to back external debt and sustain neoliberal adjustment policies.

In those years, a policy of paying debt with gold was suggested. Then-President Rafael Caldera opened the door to gold mining in the Imataca Forest Reserve [in Bolivar State], which did not happen without resistance by environmental social organizations and figures. One of the most interesting mobilizations in the history of contemporary Venezuelan environmental movements was formed.

Today, gold is being constituted as one of the main economic resorts of the government of Nicolás Maduro. But it is necessary to look beyond the trends of the expansion of mega-mining (with the Orinoco Mining Arc being the emblematic project) and the government’s drive to mine as many tons of this precious metal as possible.

The current devastating crisis, the very considerable decline in the circulation of oil revenues (and the gigantic loss of value of the Bolivar currency), the collapse of the Petro-State and the generalization of corruption have all dramatically stimulated the multiplication of informal extractive economies and territorial disputes. These are largely geared towards the direct appropriation of resources, with gold being the most prized commodity and the one that generates the greatest rivalries. These disputes are violent, very violent, and include organized armed groups of various kinds.

Seen on a geographical scale rather than as segmented elements, these gold mining projects are presented to us as complex and extensive territorial phenomena that decisively impact upon specific locations (such as [Venezuelan mining communities of] El Callao, Las Claritas, Tumeremo, Alto Paragua, Ikabarú, Yapacana, Tocuyito to name some). However, these projects go further and impact on and transform river basins, bioregions, border areas (Colombia, Guyana, Brazil) and ultimately articulate with international commodity networks.

So, Venezuela is not only going through the various dimensions which go with oil conflicts, but at the same time a raging web of multi-scale conflicts that revolve around gold are being seen.

This can be understood as the geo-ecopolitics of gold. A number of elements intertwine simultaneously, such as transnational economic interests and geopolitical intercapitalist disputes, ways of organizing and capitalizing on nature from the extractivist setup of the nation-state, territorial power groups (which may be illegal, criminal and armed), local extractive economies, significant environmental impact, and communities affected and involved in these conflicts.

Unlike oil, which is characterized by extraction mainly through infrastructure, state-of-the-art technologies and an industry highly monopolized by transnational corporations and nation-states, gold can be plucked from the land by numerous actors, without necessarily requiring extensive machinery or very complex extraction processes. In gold rushes, everyone is a potential miner. The crisis of the oil-based Venezuela and these particular geo-ecopolitics of gold are clear expressions of the current nature of extractivism in the country: kidnapping, violence, illegality and, to a large extent, survival.

Venezuela and the global gold chains: the connection between legality and illegality

Many know where gold comes from, but few, very few, know where it’s going: the global precious metal value companies which operate between legality and illegality.

In several Latin American countries, more than 75 percent of total gold extracted comes from illegal mining. In Venezuela, this figure exceeds 90%. So, we are not facing a marginal phenomenon, but one which is constitutive of gold mining and which has been sharply intensified by globalization.

As part of these global gold companies, Venezuela’s violent mines are also connected to very dark networks and markets of illegality and organized crime, international intermediaries and agents of transnational corporations (operating in the shadows), local armed groups, actors in the Colombian armed conflict and/or corrupt military officials. These are power structures that are installed and institutionalized which become dominant, controlling, of at least part of the process of appropriation and global distribution of this commodity.

This form of mining links mercury and blood, as well as high levels of deforestation, to human trafficking and the devastation of river basins with forced labour. Profits from this are generally higher than other sectors of illicit economies, such as drug trafficking (that is why some of these agents have migrated to the illegal mining business).

With the Venezuelan crisis, the national government has intensified its participation in gold mining processes, but to date it has not reactivated its formal industrial mining enclaves, let alone been able to install and operate new ones.

This implies that for the extraction of the new tons of gold that have been presented on television and in written and digital media – remember the images of President Maduro with several gold bullions in Miraflores Palace – the government ends up getting involved in and being complicit of these complex global gold networks. This is done despite the announcements that state-led extraction is only done through small miners organized by the state who do not use mercury and who practice environmentally friendly methods.

In these global chains, gold can travel through several countries before reaching refineries located in various parts of the world. Major refiners include the United States, Canada, Switzerland, Italy, and the United Arab Emirates.

Gold sales by the government of Venezuela, which are now formally affected by US sanctions, flow through alternative channels such as Turkey or Uganda, although prior to sanctions they flowed towards several of the hegemonic channels mentioned, through underground and quasi clandestine operations mainly linked to the payment of external debt and services. Various reports have shown how the vast majority of large refiners receive gold from illegal mining to different extents.

So, the gold, which comes from violent extraction with high environmental degradation and social dispossession is “washed” and melted with legal gold, then passed off as ‘bleached’ to the vaults of banks (state or private) in the richest countries on the planet, to the big jewellery companies and producers of different electrical appliances that use this material, while continuing to set the pace for commodity stock markets.

The significance of gold in the context of the global economic crisis is tremendous, and more so if we highlight the dollar (model) crisis, the trade wars, and the progressive steps of various countries and markets to break from this model and diversify the backings and values of global exchange.

It is in this context that the sustained and accelerated purchase of gold by powers such as Russia and China, which are also positioning themselves in the Orinoco Mining Arc project in various ways, must be interpreted. Likewise, so should we understand disputes over the control of Venezuelan gold, evident in neocolonial measures such as the confiscation of the gold reserves stored in international banks (such as the Bank of England).

In this way, Venezuelan gold extraction is globally fed. The current Caracas government is engaged with the brutal global neocolonial process of dispossession that this activity entails for the country and the territories directly impacted by it by proposing an unprecedented mining expansion scheme with a dizzying logic of [legal and tax] flexibility that favours transnational capital. The Orinoco Mining Arc project reflects this form of savage extraction that is being imposed on the country, which combines informal/illegal modalities with the modes of formal industrial mega-mining projects. This “adjustment extractivism” represents a new phase of looting, basically shaped to sustain local, national and foreign power groups, while bringing no benefits to the people, despite the government’s neo-language which insists it does.

Resistance and the right to life

The geo-ecopolitics of gold reveals that, through the struggle of corporate interests, international criminal networks, a state policy that operationalizes environmental stripping and devastation in the name of the people, there are numerous severely impacted communities, persons and ecosystems to be found.

In all of Latin America there are examples of resistance to this extractive activity, such as the defense of the Páramo de Santurbán and the struggles against the La Colosa project in Tolima (Colombia); mobilizations in Cajamarca against the Conga project (Peru); and the struggles of the Shuar indigenous people, together with other social organizations, against the Mirador project in the Condor mountain range (Ecuador).

In Venezuela, plagued as it is by conflicts over gold, there has also been resistance (mainly from indigenous people and communities), which has been heavily affected by the current crisis.

The breakdown of the rule of law and the strengthening of armed groups in the territories, as well as the precariousness of life [in Venezuela] have regenerated forms of struggle for survival which have marginalised the aspirations of those who defend nature.

The Pemon indigenous people, in the south of Bolivar State, have primarily defended their territorial self-determination and their right to life as a people, raising a powerful resistance [to mining projects], which has been fought by the state through violence and repression.

The Pemon people have become one of the symbols of the resistance of the indigenous peoples of Venezuela and have managed to bring together numerous expressions of solidarity from various parts of the country. These convergences represent the joining of wills, discontents and yearnings for change, which, despite coming from very different areas and trades, reveal the potential of the coming together of the grassroots around issues that arise from below (something that impacts them, as in the case of mobilizations in defense of Cerro La Vieja).

These struggles open embryonic articulation possibilities towards ample platforms or movements. Above all, these struggles contribute to creating conditions for the emergence of new political subjectivities, new worldviews, and new forms of struggle in which the defense of territory and nature, against extractivism, are also part of the priorities of the grassroots movements.

The picture is very complex and adverse, but also very contradictory, unstable, and actually full of opportunities.

Emiliano Teran Mantovani is a sociologist and a member of the Venezuelan Observatory of Political Ecology. He is also an associate researcher at CENDES (UCV) and is part of the Working Group on Development Alternatives organised by the Rosa Luxemburg Foundation.

Translated by Paul Dobson for Venezuelanalysis.

The views expressed in this article are the author’s own and do not necessarily reflect those of the Venezuelanalysis editorial staff.