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Brazil strengthens fight against illegal gold mining

Bnamericas Published: Wednesday, July 27, 2022
Brazil strengthens fight against illegal gold mining

Brazilian authorities are mulling stronger measures against illegal gold mining to shore up the country's image among international investors.

Central bank head Roberto Campos Neto met Tuesday with representatives of mining association Ibram and NGOs Instituto Escolhas, Instituto Socioambiental (ISA) and Instituto Ethos to discuss the creation of a working group to develop improved inspection and control mechanisms for gold production and sales.

The federal police and the tax authority are also likely to be part of the planned working group. 

"Standing with the central bank is essential to move forward with the inspection of illegal Brazilian gold that contaminates international markets. We hope the meeting marks the beginning of a lasting collaboration with positive results for the country," Instituto Escolha project manager Larissa Rodrigues told BNamericas. 

Proposing the use of blockchain technology, the NGO is among the most active in combating illegal gold mining.

Brazil is a top gold exporter, and according to Instituto Escolhas, nearly half the country's production between 2015 and 2020 shows "serious signs of illegality."

Tackling illegal mining is also expected to mollify investors.

"The main point of concern for investors in Brazil currently is no longer corruption, but issues related to environmental impacts," Alexandre Pierantoni, the head of corporate finance and M&As at consulting firm Kroll, told BNamericas recently.

Companies that want to raise fresh capital via markets are also highlighting positive environmental aspects of their projects.

Earlier this month, junior Bravo Mining raised Cdn$40.3mn (US$31mn) via a shares offer in Canada to develop its Luanga polymetallic project in Pará state. 

The company highlighted that "the project area was previously deforested for agricultural grazing land. Bravo's current environmental, social and governance activities include replanting trees in the project area, hiring and contracting locally, and ensuring protection of the environment during its exploration activities." 

Luanga is a palladium, platinum, rhodium, gold and nickel project in Carajás municipality.

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