Sustainable Livelihoods as an Alternative to Illegal Mining (Part II)

Satellite view of patterns created from illegal mining in Peru (Source: Wikimedia Commons).

Illegal small-scale gold mining activity by garimpeiros, the Portuguese term for wildcat miners, has increased dramatically in the indigenous Yanomami territory of Brazil since 2015, wreaking havoc on their livelihoods and on the Amazon rainforest ecosystem. Part one of this two-part series examined how the Brazilian economic crisis of 2014 disproportionately affected poor Brazilians, increasing rates of unemployment and poverty. At the same time, rising gold prices in 2016 made mining a comparatively lucrative activity compared to other menial jobs. Despite the dangers associated with illicit mining, some low-income workers began to see it as the best method for supporting their livelihoods.

 With the garimpeiros’ increased risk tolerance and the higher expected rewards for illegal mining, laws alone are insufficient in preventing their invasions of indigenous territory. If the government simply imposes more regulations, miners will continue to find loopholes or simply violate them, which would only increase the frequency of illegal activities. Keeping this in mind, this part of the series explores potential policy solutions for addressing the persistence of illegal miners through a comparative study of Peru’s actions in Madre de Dios.

Madre de Dios: A Comparative Study

Brazil’s neighbor Peru is abundant with natural resources and therefore similarly plagued with illegal miners. However, Peru has also been much more intentional and forceful in its efforts to combat the problem. 

Under former President Pedro Pablo Kuczynski, the Peruvian government put forth a formalization plan for combating illegal gold mining activity in the country. In 2016, Legislative Decree 1293 created the Integral Registry of Mining Formalization that set out the requirements and processes for formalization of the status of artisanal and small-scale miners. The overall goal of formalization is to incentivize illegal miners to begin complying with mining regulations and eventually shift their activities to the legal sector. Through the establishment of a Mining Promotion Bank, the government purchases gold from garimpeiros at a higher price than they could sell on the illegal market, and thus initiates a connection between the state and miners. The bank also trains miners to comply with safety and environmental regulations, and upon their agreement to mine legally, miners are offered participation in a pension system and a credit system.

Brazil’s set of guidelines that regulate the mining industry has often been insufficient to  prevent illegal and informal mining. The 2030 National Mining Plan, established in 2011 as the new institutional framework for mining, notably fails to mention small-scale mining. Moreover, neither the Brazilian Mining Code nor any separate legislation contains specific measures that regulate mining on indigenous land.

However, the formalization of small-scale mining in Brazil is limited by the government agencies’ lack of resources, such as personnel and funds. The process for granting environmental licenses and mining permits is slow. Since there is no one to guide them through the process, many miners remain unfamiliar with the documents, environmental impact assessments, and other requirements to obtain legal permission to mine. Most importantly, given that Brazilian miners are driven to operate illegally by desperate economic conditions, formalization will likely not mitigate the issue unless the Brazilian government offers them economic incentives.

An alternative policy for addressing illegal mining is targeted, comprehensive military intervention. The Peruvian government launched Operation Mercury in February 2019, a two-year effort to remove illegal gold miners from La Pampa, a mining zone in Madre de Dios. It began with 1,200 federal police, 300 soldiers, and 70 prosecutors removing an estimated 6,000 garimpeiros from La Pampa, and then establishing a “semi-permanent government presence” to deter them from returning. The Bureau of International Narcotics & Law Enforcement Affairs of the U.S. Department of State provided operational and technical support to the Peruvian National Police and Attorney General. 

Although Brazil has used the military to combat illegal miners in the Yanomami land, its operations remain primarily retroactive as opposed to concentrating on the prevention of future illegal activities. Under Operation Warari Koxi in 2015, 150 Federal Police officers investigated 313 warrants against suspects of illegal mining, primarily targeting the Yanomami region. More recently, the Yanomami Operation (which was launched in August 2021 to combat illegal mining) has seized 111 aircrafts and 30,000 kilograms of ore, arrested 38 people, and distributed 1,000 food baskets to the region. These interventions have been ineffective and instead led miners to attack the police and raid indigenous villages.

A Sustainable Solution?

To effectively prevent illegal mining, the Brazilian government must implement sustainable long-term plans that discourage illegal miners from returning to the Yanomami territory. One way to approach this is by encouraging miners to leave the industry altogether through offering alternative economic opportunities in Roraima and Amazonas, but outside the Yanomami land. 

Specifically, the Peruvian government’s plan to combat illegal mining in Madre de Dios includes economic initiatives aimed at creating sustainable development employment opportunities for local inhabitants. Peru’s Ministry of Production set aside S/25 million ($7,550,000) for projects related to logging, Brazil nuts, cocoa, fishing, and aquaculture in 2019. Similarly, agriculture, including goods like Brazil nuts and livestock, is becoming an increasingly important sector for Roraima. The Brazilian government can target these industries for creating jobs that serve as economically viable alternatives for illegal miners. Moreover, the government can and should collaborate with NGOs that are already working on these initiatives, such as the Amazon Conservation Association’s project “Conserving Brazil Nut Forests.”

A Brazil nut harvester at work in Madre de Dios, Peru (Source: Flickr).

The big challenge for the government is to make these industries more appealing than illegal mining when the latter seems comparatively lucrative. However, an environmental management study on a national reserve in Madre de Dios found that with the government’s “enhancement of value creation at product origin,” forest-friendly livelihoods like Brazil nut harvesting and fish farming can be more lucrative than mining. Enhancing value creation would entail adopting strategies to raise the income of these farmers’ livelihoods through reducing costs and commanding higher market prices, such as creating associations that pool resources, leverage economies of scale, and help farmers obtain organic certifications. Thus, a comprehensive policy would include government assistance of capacity-building efforts for association management, as well as the provision of certification training, microloans to cover upfront costs, and refrigerated storage and transportation.

Another limitation to government-driven initiatives is that illegal miners are driven by conditions of poverty in their home states every year, but these policies only increase economic opportunities in states within Yanomami territory. Thus, there must be enough alternative job opportunities to accommodate for a continuous stream of new migrants. This flow of new workers should not be a major problem, since the policy creates infrastructure such as formal training programs to incorporate new workers into the associations. Moreover, the existing network of garimpeiros would shrink, making illegal mining a riskier activity and hopefully deterring potential workers from joining the industry.

Creating economic alternatives to illegal mining has numerous benefits over retroactive, ad-hoc actions solely designed to punish miners. First, these livelihoods—including Brazil nut harvesting, fish farming, logging, and eco-tourism—allow for or even require intact forests, which would help reduce the social costs associated with deforestation from mining activities and preserve the habitat of the Yanomami. Second, this approach is a long-term solution because it addresses the main motivations of miners: the quest for financial security. Since incomes from Brazil nut harvesting and fish farming can be higher than returns from illegal mining, garimpeiros would have financial incentives to shift away from the mining industry, rather than seek ways to evade government authorities. Finally, the policy would demonstrate the Brazilian government’s commitment to improving the lives of illegal miners instead of punitively treating them as enemies of the state, further incentivizing miners to comply. 

A sustainable policy solution must confront the underlying economic conditions that drive low-income workers to stay in or join the industry. Wildcat miners are not intrinsically against environmental or indigenous rights issues. Rather, precarious economic conditions cause them to prioritize the economic stability that they associate with mining over its legal and environmental consequences. What miners want are not necessarily more relaxed environmental regulations, but more economic opportunities. This should be a cause of celebration for Brasília; there is a path for the government to mitigate the concerns of miners without necessarily compromising the interests of environmental groups and indigenous tribes.