Colombia illegal mining 'outstripping drug trade'

Colombia, which has set out to formalize its illegal mining industry, is arresting rising numbers of foreigners entering the country attracted by a trade that has reportedly become more profitable than drug trafficking.

Colombian police have arrested citizens from Asia, Europe and neighboring South American countries drawn by the value of illegally extracted gold, now believed to be worth 20 times more per gram than cocaine. Chinese, Brazilians and Italians are among those who have been arrested this year.

Guerrilla groups including the FARC have turned to illegal mining to fund their insurgency, according to General Luis Martínez, who heads the government crackdown on illegal mining.

Illegal mining operations are blamed for widespread pollution as cyanide and mercury are dumped into jungle rivers.

"This is the biggest source of funding at the moment for illegal armed groups, bigger than cocaine," Martínez told Bloomberg. "The economy this is generating is extremely worrying."

For decades, the UN considered Colombia to be the world's biggest cocaine producer until it was overtaken recently by neighboring Peru. Colombian miners including Mineros and Gran Colombia Gold produced 56t of gold last year, according to the national mining agency (ANM).

Unauthorized mining outfits, which also extract platinum, coltan, coal and construction materials, account for more than half of the country's operations.

In a 2010-11 census on mining activity in Colombia, the mining ministry (Minminas) registered 14,357 mining production units in Colombia of which 63%, or over 9,000, did not have mining titles.

Illegal gold mining has spread in Colombia, Peru, Ecuador and Bolivia as gold prices jumped sevenfold over a decade to US$1,900/oz by 2011, according to Swiss government program Better Gold Initiative.

The governments of Colombia, Bolivia, Brazil, Ecuador, Guyana, Suriname, Venezuela and Peru have pooled efforts to fight illegal mining in the region in the Amazon Cooperation Treaty Organization (ACTO).