Searching For El Dorado
We’ll begin today’s session with a couple of articles on the same subject. First up we have the Christian Science Monitor telling us that Bolivar state in Venezuela is bursting with biodiversity,breathtaking water falls (Angel Falls is the highest continuous water fall in the world), jungles, and table top mesas known as ‘tepuis’. It is also the home of Nicolas Maduro’s “Mining Arc” which clears and destroys vast swaths of land and carves large semi-circles deep into the jungle floor. The state refuses to take responsibility for protecting the land (even though environmentally responsible mining was the “Mining Arc’s” stated purpose) and Venezuela’s economic unraveling has eviscerated incomes and social support systems in recent years.The area’s more than 200 Indigenous communities have turned to a place they would rater not go… the mines.
One Indigenous man, in charge of a mining community and speaking on condition of anonymity (his mine is illegal) said, “We know what we’re doing is not good… The gold mining creates all kinds of destruction, the ecosystem, the water, everything. We don’t see any alternative so we keep mining…to sustain our families.”
What used to be a choice between farming or fishing and hunting has become, for many Indigenous people, a choice between staying and working in the mines or leaving their ancestral lands and joining the almost 7 million Venezuelan migrants fleeing 21st Century Bolivarian Socialism as there are few opportunities for them if they remain in Venezuela.
In the late 1970s Venezuela was one of the first Latin American countries to create a Ministry of Environment. In 2011 the government began censoring environmental and scientific data. In 2014 the Ministry of Environment was eliminated. In 2015 the government launched the Ministry of Eco- Socialism and in 2016 the Ministry of Ecological Mining Development was created. (Maduro’s way of addressing any issue is to form a new Ministry. Hugo Chavez had 11 Ministries during his time in power. I stopped counting when Maduro reached 30 Ministries…Oh, and FYI…most of these Ministries do absolutely nothing)
These steps intensified and justified mining activities and did nothing to protect the Indigenous peoples nor their ancestral lands. (Told ya’) In addition to the environmental devastation the Venezuelan authorities permit violence, forced labor, and sexual exploitation. As we’ve mentioned before, there is an Indigenous Ministry as well as an Ombudsman. One is to look out for the well-being of Indigenous peoples and the other is to look out for the well-being of all Venezuelan people. Neither looks out for the well-being of anyone…except themselves.
Then we have Reuters telling us that before the creation of Nicolas Maduro’s “Mining Arc” most of Venezuela’s gold production was from small artesanal miners. Now most of these small miners are being forced out as the Maduro regime is attempting to ramp up production by building “strategic alliances” (Maduro is really big on “strategic” or “historic” alliances) with larger, select private companies.
With the collapse of oil production (destroyed by Chavismo) the government is turning to gold mining to replace lost revenue. The creation of the “Mining Arc” did little to provide revenue for the government as most of the gold wound up in the hands of a combination of criminal gangs, paramilitaries, traffickers, and the military.
The government needs to replenish it’s gold reserves, which are down to $4.3 billion from over $30 billion before Hugo Chavez repatriated most of Venezuela’s gold to Caracas to “protect it for the people”. (Is protecting it for the people the same as stealing or misusing it?) To that end they have granted 12 private companies (terms of the alliances and names of the companies have not been released) permission to build 30 processing plants using sophisticated equipment, most of which are already up and running.
The latest government budget estimates (historically unreliable) put income from gold royalties at $232 million for 2022, 170 times higher than estimates for 2021 (there is no official data on gold production for 2021…big surprise, huh). We don’t know if all this is translating into the expected revenue for the government (it didn’t when the “Mining Arc” was created) but we know the money isn’t flowing to the artesanal miners, as it did in the past. One gold trader said he used to receive 200 grams of gold a day from artesanal miners. Now he gets 10.
Then we have Mehr News reporting that the Venezuela Transport Minister, Ramon Velasquez, invited Iranian investors to participate in Venezuela’s mining initiative. (Why is the Transport Minister involved in mining?) This news coming from the Transport Minister might be unusual in most countries but remember, Maduro selected a guy prohibited by sanctions from talking to bond holders to be in charge of talking to bond holders to restructure Venezuela’s defaulted debt. (You can’t make this stuff up)
So there you have it. Just like the conquistadors of old, Nicolas Maduro and the Chavistas are searching for “El Dorado”, the lost city of gold, and so far have had the same results.
Then we have the National Interest reporting on a situation we’ve previously told you about. Remember the former Miami congressman being sued by Citgo (US based refining company, majority owned by PDVSA, which is owned by the Venezuela government) for funneling $50 million, through various means, on behalf of the Maduro regime, including a considerable amount to a Venezuelan oligarch with ties to Maduro?
What wasn’t reported previously was that even if the congressman, David Rivera, prevails in the civil suit he may face charges related to FARA, the Foreign Agents Registration Act. US-DOJ (United States Department Of Justice) must determine if Rivera was “engaged in political activities or other activities” as an agent of a foreign principal, in which case he would be required to register with FARA, which he didn’t do. First things first, they’ll deal with the $50 million.
And we have Rio Times telling us that with the reconciliation between Bogota and Caracas many Colombians living in Venezuela are hoping to regularize (legalize) their status due to expired visas and passports unable to be renewed after the border and consulates were closed in 2019.
Then we have OilPrice.com reporting that Venezuela needs to invest $50 billion at least to modernize and restore it’s refining complexes after years of rampant corruption, lack of investment, and serious lack of maintenance. To make matters worse they also lack skilled workers (after Hugo Chavez fired 18,000 experience workers at PDVSA and replaced them with 40,000 Chavista loyalists and many of those who remained have since left Venezuela) and accidents are commonplace.
Even if PDVSA would start to invest in the renovation of it’s refinery complexes right now (and they have no money…which begs the question, where will they get the $ 1.5 billion for the deal they made with Iran to upgrade their refining facilities?) it would take a long time to attract skilled personnel, improve health and safety practices, and working conditions to restore production. (To reinforce the point, the $1.5 billion deal with the Iranians, even if PDVSA can find the money, is a far cry from the $60 billion needed) See… we aren’t the only ones saying saying it. The Maduro regime won’t see it’s production capacity restored any time soon. (Do you think Joe Biden knows this?)
And in case you were wondering…France 24 reports that Nicolas Maduro announced Colombia and Venezuela will jointly reopen the border between the two countries on September 26th. Colombia President, Gustavo Petro, issued a similar statement.
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