Procurement of gold and Switzerland in the focus of the Human Rights Council
As the Human Rights Council’s recent session began at the United Nations’ European headquarters in Geneva, several discussions about illegally mined gold erupted, with the role of importers, including Switzerland, cited in two UN findings.
This content was published on September 26, 2022 – 09:00
Last week, a special rapporteur investigating the use of mercury in small-scale gold mining and a UN fact-finding mission to Venezuela submitted separate reports to the Council on the impact of gold mining on many communities and the environment, particularly in the Amazon Basin.
UN investigators cited human rights abuses such as the sexual exploitation of women and children, mercury poisoning and child labor affecting communities where illegal gold production takes place, finger-pointing the responsibility of countries buying the metal.
According to the reports, global buyers like Switzerland – through which about two-thirds of the world’s trade is processed – need to ensure that human rights are respected in all supply chains.
Insatiable demand and lack of care
“It’s a serious problem,” Marcos Orellana, the UN Special Rapporteur on Toxic Substances, who investigated human rights abuses in artisanal mining, told SWI swissinfo.ch. “In the coming months and years we can expect further scrutiny by human rights mechanisms of the gold sector and countries hosting refiners, including Switzerland.”
Switzerland is the world’s top importer of gold, having bought 90 billion francs ($92.3 billion) of the metal in 2021. Four of the world’s largest refineries are located in Switzerland, two of which are foreign-owned.
In 2020, Reuters news agency estimated that three of the top refiners – Valcambi, Argor-Heraeus and PAMP – refined about 1,500 tons of gold annually.
Orellana described to the Human Rights Council last Tuesday how pregnant women in indigenous communities living downstream from gold mining in the Bolivian jungle had high levels of mercury in their blood from eating contaminated fish, while sexual abuse and violence were rampant in mining areas. That reportexternal link describes how even on Pacific islands thousands of miles from gold mines, elevated levels of mercury have been found in residents due to global ocean contamination.
According to the United Nations, around 10 to 15 million people were directly involved in artisanal mining worldwide in 2017, including around a million children and 4.5 million women.
Mercury, used to separate the gold from other substances, is a highly toxic heavy metal that bioaccumulates in living things and can cause permanent harm in humans, including neurological disorders, reproductive disorders and death.
“The use of mercury is being driven by the insatiable demand for gold from financial markets and jewelers in the wealthiest countries,” Orellana told the Human Rights Council assembly. “Refiners in developed countries that buy the gold lack adequate due diligence mechanisms to address the human rights abuses associated with mercury and small-scale gold mining.” led the Alpine nation in terms of gold imports.
After his synopsis, he said in a telephone conversation with SWI that Switzerland had to do more.
“Switzerland … does not have a proper traceability system that would require refiners to know where the gold came from and how it was mined,” Orellana said. “The traceability system that Switzerland has ends with the intermediate country. This loophole is being exploited by criminal syndicates and drug cartels trading mercury and gold.”
“While the gold industry benefits, human rights suffer,” he added.
In the south-eastern Madre de Dios region of Peru, previously SWI reportedexternal link how almost 1,000 square kilometers of rainforest had been lost when illegal miners sold their gold to buyers, allegedly also in Switzerland, who were willing to turn a blind eye.
Following Orellana’s presentation to the Council, more than 40 countries participated in an interactive dialogue on actions needed to reduce human rights abuses in artisanal mining. The Swiss Mission was not one of them.
Paola Ceresetti, a spokeswoman for the mission, later responded to SWI’s request for comment after the report’s release. “In Switzerland, the gold trade is controlled by one of the strictest laws in the world. In particular, the Precious Metals Regulation and Money Laundering Act is designed to ensure that the gold handled by refiners does not come from fraudulent sources,” she wrote in an email.
Venezuela’s golden abyss
According to another related report to the Human Rights Council, armed violence between sindicatos – criminal groups that control mines – as well as labor and sexual exploitation and appalling punishments by arbitrary justice are rampant in Venezuela’s gold mining region. Known as Arco Minero, the area was created specifically to mine resources when the country’s economy took a hit in hopes that it would attract foreign investment. Both local residents and miners were often “caught in a crossfire of violence” in the struggle for control of the gold, Francisco Cox, a member of the fact-finding mission, told reporters.
The report will be presented to the Human Rights Council at its meeting today.
Orellana said non-state actors, such as sindicatosand authorities, including military and civilian leaders, with financial interests in mining operations have been responsible for killings, extortion, corporal punishment and gender-based violence.
While official data is sparse and lacking in transparency, various reports estimate that between 70% and 90% of gold sourced from the mining region is produced illegally, Cox said.
The Venezuela report recommended that countries importing gold take measures to prevent gold laundering, as well as money laundering from gold mined in Venezuela’s mining regions.
Official Swiss data shows that the country stopped importing gold directly from Venezuela in 2016. Since then, however, there have been concerns that gold could enter Switzerland after transiting other countries.
The Venezuelan mission to the United Nations in Geneva did not respond to a request from SWI for comment on allegations of collusion and the authorities’ involvement in the gold trade.
transparency in court
As pressure mounts on gold importers to ensure cleaner sourcing, Swiss refiners recently responded by pledging to remove all gold from Indigenous countries from their supply chains. In 2020, Japanese-owned Metalor, based in Neuchâtel, announced it was ceasing purchases of artisanal mines.
Still, Swiss data shows that large amounts of gold are being imported from non-producing countries, including the Middle East and Europe, raising questions about where the gold is coming from.
Many are pressing for answers.
The Society for Threatened Peoples, a Bern-based NGO, is awaiting a Supreme Court decision in the coming months after filing requests to the Federal Customs Administration in 2018 to release files detailing the precise origin of gold imported into the country, and argued that it was in the public interest to know. STP has long investigated illegal gold production in the Amazon and its links to Swiss refineries.
Edited by Virginie Mangin
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