Venezuelan lawmakers approve sweeping mining bill to lure foreign investors

CARACAS, Venezuela (AP) — Venezuelan lawmakers on Thursday approved a bill to regulate the country’s mining as it seeks to attract leery foreign investors to a once-private industry that has long been exploited by criminal groups believed to have ties to the government.

It is the latest legislative initiative by acting President Delcy Rodríguez since the self-proclaimed socialist government that has ruled Venezuela for 26 years came under pressure from the Trump administration in January, when the U.S. military deposed then-President Nicolás Maduro.

The lengthy bill will now undergo a review by the country’s high court to determine if it is constitutional.

The bill regulates mineral rights, establishes small, medium and large-scale mining categories, and allows for independent arbitration of disputes, which foreign investors view as key to guard against the government seizing their assets. It also bans the president, vice president, ministers, governors and others from holding mining titles.

Two decades ago, many foreign firms in the mining and oil sectors saw their assets seized by the Venezuelan government. However, as crucial oil revenues plummeted, Maduro’s government in 2016 designated more than 10% of Venezuela’s territory as a mining development zone stretching across the central area of the country.

Since then, mining operations for gold, diamonds, copper and other minerals have proliferated. Many of these sites are informal, unlicensed mines operating under brutal conditions and the presence of criminal groups.

Homicides, human trafficking, fuel smuggling and other crimes are commonplace in mining areas, but ordinary Venezuelans continue to flock there in hopes of getting rich quick and escaping poverty.

Officials and members of the military take cuts from the illegal mining revenue in exchange for allowing the operation of mines.

“The mining and subsequent sale of gold has proven to be a lucrative financial scheme for some well-connected Venezuelans and senior officers within the National Bolivarian Armed Forces, which profits from charging criminal organizations for access and inputs, such as fuel,” the U.S. State Department reported to Congress last year.

“The estimated market value of gold mined in Venezuela is difficult to confirm, but well-respected sources estimate that it averaged $2.2 billion annually over the past five years.”

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