Why illegal gold mining is overtaking cocaine as the drug of choice for traffickers in Latin America

By Tim Lister, Claudia Rebaza, CNN

(CNN) — The Trump administration’s drone strikes against boats allegedly bringing illicit drugs to the US come amid an explosion in the amount of cocaine being produced in Colombia and Peru.

But there is a new – and lethal – factor that is turbo-charging production – especially in Peru: the relationship between coca cultivation and illicit gold mining.

It’s a toxic combination that is enriching criminal gangs and corrupt officials, as the price of gold touches new highs on world markets. And it’s taking root in other states – including Ecuador, Brazil and Venezuela.

In July, Peru’s then foreign minister Elmer Schialer said the illegal gold economy in Peru was seven times bigger than the cocaine trade.

Colombia has traditionally been the epicenter of coca cultivation in South America. But cocaine production has spiked in Peru, where more than 800 tons were produced last year according to the US State Department.

Coca cultivation has spread from remote mountainous areas into Peru’s lowlands, a huge stretch of land adjoining Brazil and Colombia, where new variants thrive.

The region of Ucayali has seen the greatest increase in coca cultivation, as well as clandestine airstrips and drug exit routes, according to a recent Amazon Watch report by Ricardo Soberon, a former director of Devida, the official Peruvian agency tackling illegal drug flows. Research by investigative group Mongabay last year identified 128 clandestine airstrips cut into the jungle across six Peruvian regions, some surrounded by coca plantations.

The COVID-19 pandemic triggered an exponential spread of illegal gold mining and coca production, said Dan Collyns, a writer on organized crime in the Amazon region.

The police were enforcing a strict lockdown, giving free rein to organized crime groups to expand their territorial control, particularly in remote areas. And the lockdown meant that many Peruvians, more than 70% of whom work in the informal economy, were forced to find alternative incomes, often in illegal occupations, Collins said.

Traditionally, according to Collins, Peruvian producers have worked with mostly Mexican cartels to ship the processed drug from Peru’s Pacific coast. Several US strikes that have targeted vessels allegedly carrying drugs have been in the Pacific, but the vast majority of Peru’s cocaine is destined for Europe, according to a former Peruvian interior minister, Ruben Vargas.

‘Narco-mineria’

The nexus of coca cultivation and illicit gold mining is offering a swifter route to riches for criminal enterprises across the Amazon region – from Peru and Ecuador to Colombia and Venezuela. It’s known as narco-mineria, according to Collins.

The advantage is simple.

Cocaine is illegal from cultivation to its sale on the streets. Much of Peru’s gold is illicitly mined but when refined is indistinguishable from legitimate metal, its origin untraceable.

“Criminal organizations have found that illegal gold mining is a safer and more lucrative asset in which they can invest money from drug trafficking, and, in turn, launder the assets more easily,” according to Collins, author of the forthcoming “Blood Gold: The Shocking True Story of the Amazon Gold Rush.”

Gangs use “the same smuggling routes, logistics, precursor supplies like diesel, and use their territorial control to exploit whatever resources are available: gold, coca, timber,” he added.

Along Peru’s Amazon border with Colombia, dissidents from the Colombian rebel group FARC control production and distribution. Along Peru’s longer border with Brazil, “Comando Vermelho (Red Command), one of Brazil’s most powerful crime groups, has established itself,” according to Collins.

“Initially, around 2021, we saw how it was vying for control of the tri-border area of ​​Peru, Brazil, and Colombia. Currently, we know that it manages illicit coca crops in Ucayali, which entails violent practices in the region, but it also controls mining operations and ‘security’ in Madre de Dios,” said Pamela Huerta, an investigative journalist with the Amazon Underground project.

Vargas, the former interior minister, told CNN: “The Red Command has hooked into these two commodities of the illegal economy and is trying to control the routes and the production centers.”

It is now shipping cocaine to Brazil to feed the rapidly growing market there – and in the meantime stoking what Vargas calls the worst surge in crime in Peru’s history.

Further east, across the Amazon basin, Colombian gangs are working with Venezuelan groups in both illegal mining and cocaine trafficking.

There is “unchecked illegal mining” in the southern Venezuelan regions of Amazonas and Bolivar, according to the global think tank Crisis Group, “strengthening Venezuelan criminal enterprises, Colombian guerrilla groups and corrupt elites.”

Venezuela is now reportedly home to over 30 per cent of the illegal mining sites in the Amazon basin, Crisis Group estimates.

“In some cases, members of the armed forces have taken sole charge of the pits for their personal enrichment,” according to a recent report by Crisis Group. Colombian gangs and Venezuelan syndicates known as sistemas both operate in the region and have even begun moving into neighboring Guyana, it says.

“Drug trafficking routes in southern Venezuela pass through the same remote jungle terrain, with profits from the narcotics trade frequently laundered through investments in the gold industry.”

Ecuador has also seen a surge in crime related to illegal gold mines near the Peruvian border, while a ruthless Peruvian gang calling itself Guardianes de la Trocha (Guardians of the Trail) is running a protection racket at illegal mines.

Earlier this year Guardianes allegedly shot dead Ana Denisse García Solsol, a prominent figure in the Peruvian town of La Pampa. Local prosecutors believe mass graves contain the bodies of more than 100 people killed by the group.

In the face of these powerful gangs and vast unpoliced areas of forest, eradication efforts and prosecutions are sporadic.

The Peruvian interior ministry says it eradicated some 27,000 hectares of coca cultivation in the first nine months of this year. But eradication has also worsened deforestation by pushing cultivation into more remote areas, Soberon said.

“Deforestation in the Peruvian Amazon, the poisoning of its rivers, and the loss of wild flora and fauna, in addition to the impact on the communities that have lived ancestrally in these territories, are irreversible at this point,” Huerta told CNN.

Peru’s volatile, fractured politics, as well as widespread corruption, have aggravated the situation. There have been more than a dozen interior ministers in the past five years.

Often, illegal logging and mining are a result of the corrupt award of licenses and permits by elected public officials and senior bureaucrats, according to a report from the UN Office on Drug Control.

“The result is weak internal security and a lack of continuity in law enforcement. At the same time, lobbies within Peru’s unpopular Congress favor illegal gold mining,” the writer Collyns said.

Some of the income from those businesses is finding its way into Peruvian politics ahead of next year’s elections.

Vargas, the former interior minister, agrees that the response to illegal mining is tainted by its links to the political system.

On top of that, he said, “the fight against drugs has been abandoned” in regions where consumption is highest, including Europe and Brazil.

“They are turning producer countries into fertile ground for transnational criminal groups.”

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