The mining industry remains one of the primary economic engines of Latin America and the Caribbean. Chile, for example, holds 31.3 per cent of global lithium reserves and Argentina 13.3 per cent. The region produces 38 per cent of the world's copper and also has significant reserves of cobalt and gold.
Such abundance has turned the region into a magnet for foreign direct investment (FDI), attracting 21 per cent of the global $1.166 trillion value of FDI in mining. Countries around the world are turning their attention to Latin America and the Caribbean in efforts to secure the raw materials needed to protect their economies from rising energy costs and supply chain disruptions.
However, the same economic value that drives development and FDI also attracts organized criminal groups.
These groups exploit weaknesses in oversight and regulation to infiltrate the sector, using corruption as a tool to obtain licenses, manipulate contracts, inject and launder illicit proceeds in and through the mineral trade. Their involvement not only distorts markets and deters legitimate investment, but also fuels violence, insecurity and the capture of state institutions.
The convergence of organized crime, money-laundering and corruption in the mining sector poses significant risks:
Security: Armed groups exert control over mining areas, often using intimidation, extortion, and violence. The Americas have the highest regional homicide rate in the world and also the largest proportion of homicides linked to organized crime.
Governance: The influence of bribery, abuse of power, trading in influence and conflicts of interest undermine decision-making processes and erode public trust in institutions.
Economic: Illicit activities distort competition, discourage FDI and weaken the ability of companies to compete fairly.
Stability: When criminals infiltrate government institutions, they help illegal economies grow. As these illicit profits increase, criminals in turn gain even more political power, creating a cycle that strengthens their influence.
These interconnected threats do not stop at national borders, making joint regional responses indispensable.
"Regional cooperation is key to tackling organized crime, money-laundering, bribery and abuse of power. Minerals may be extracted in one country but pass through many jurisdictions, and criminals exploit borders and weaker controls, using front companies and foreign bank accounts, to launder proceeds and give illegal operations a legal appearance," says Daniela Sota, Crime Prevention and Criminal Justice Officer at the UN Office on Drugs and Crime (UNODC).
As the custodian of the United Nations Convention against Corruption (UNCAC), UNODC supports States in implementing the world's only legally binding anti-corruption instrument. Through its Regional Corruption and Economic Hub for Latin America and the Caribbean, UNODC works with governments and regional partners to strengthen responses against organized crime, money-laundering and corruption in the mining sector. The Hub provides technical support, facilitates cooperation and promotes the adoption of effective policies and practices across the region.
With UNODC's support, countries in the region have made several concrete commitments. Authorities from 17 countries of Latin America and the Caribbean developed an interactive and practical Action Plan which includes 28 key activities with examples of how they can be implemented. It allows countries to avoid starting from scratch by building on proven good practices and lessons learned, and by tailoring actions to their specific needs.
Brazil's Financial Intelligence Unit will train relevant government agencies on analysis of suspicious transactions and activity reports. Prosecutors from Honduras will evaluate how to build on the experience of Chile and Ecuador on non-conviction-based forfeiture practices. Suriname's Minister of Justice and Police began exploring collaboration with Jamaica and Trinidad and Tobago. A dedicated secure messaging group linking 37 authorities has been established to support real-time exchange of operational information, which is crucial to move forward quickly with investigations.
The importance of cooperation is a recurring theme. Strong cooperation efforts and sharing of information provide a real opportunity to address illicit activities, restore investor confidence and contribute to the long-term stability of the mining sector.
"Among the experiences and good practices within countries, one vital aspect is institutional coordination. It remains a major challenge, not only in Colombia, but across the entire region. Strengthening this coordination is also essential to combat organized crime throughout the different stages of the mining value chain," said Tania Guzman, Colombia's Deputy Attorney General for Environmental, Mining, Energy and Agricultural Affairs.
Source: UNODC
