Revenues from illegally mined gold in Peru have reached record levels, fueling criminal organizations as the country considers whether to expand efforts to formalize mining.

Exports of this gold are expected to reach a record $6.84 billion in 2024, an increase of 41% compared to 2023, according to the Instituto Peruano de Economía (IPE). According to the IPE, around 44% of South America’s illegal gold come from Peru.

At the same time, the Peruvian Congress is debating an expansion of the Registro Integral de Formalización Minera (Reinfo), a measure designed to regulate small-scale and artisanal mining, despite its limited success so far.

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Since Reinfo exempts from criminal liability miners who have requested to engage in the process of formalizing their business, the system has allowed many workers to continue mining gold illegally.

Controlling illegal mining poses a significant challenge for Peruvian authorities embarrassed by political instability and limited enforcement power, with President Dina Boluarte’s popularity rating at just five percent.

InSight Crime Analysis

With global gold prices soaring, illegal mining has become a key source of income for criminal groups in countries like Peru, Colombia and Bolivia.

The high value of gold has made controlling illegal mines a lucrative business for these organizations, who channel their profits into expanding their operations and financing other illicit activities, including drug trafficking and extortion .

The IPE reports that 44% of Peru’s total gold exports come from illegal mining, while in Colombia this figure rises to 85% and in Bolivia 50%. However, environmental lawyer and illegal mining expert César Ipenza suggests that the situation in Peru could be more serious than in other countries due to the scale of illegal gold mining and its export, which far exceeds that of Colombia and Bolivia. According to national reports, although Peru exported 77 tonnes of gold in 2023, Colombia shipped 72, and Bolivia 51.

Ipenza also noted that official export statistics could miss a substantial amount of illegally mined Peruvian gold due to weak border controls, leaving a notable portion of annual exports untracked.

SEE ALSO: Increasingly aggressive attacks by gold mining gangs in Peru

Ipenza also highlighted the involvement of foreign criminal actors in Peru’s illegal mining industry, adding even more complexity to an already difficult situation. “It is true that there are foreign actors or hitmen providing security in the region,” he said, referring to reports from organizations such as the Venezuelan Megaband. Train from Aragua and the Ecuadorian gang Lobos in Peru’s illegal mining sector. With the rise in gold prices, this activity is becoming increasingly profitable for these groups, who make substantial profits from illegal mining.

Featured image: Environmental devastation of an illegal mining area in Peru. Credit: Rodrigo Abd/Gatoparto