The investment rush promised by the Trump administration has left no mark on Venezuela’s dusty, dilapidated gold industry hub.
Under pressure from Washington, Venezuela’s state mining company in March shifted its sales of gold bars to the United States from the Middle East, practically overnight.
A Times investigation traced gold arriving in the United States to miners who pay protection money to gangs. U.S. financiers are exploring investments in mines tied to local gangsters.
We also found no sign that residents in Venezuela’s mining region are benefiting meaningfully from President Trump’s gold rush. We traveled to the gold mining town of El Callao and found that expanding operations had only further degraded the town’s broken public services.
Practically all of El Callao’s paved roads have been destroyed by years of heavy truck traffic. Everything in the town, down to the freshly hung laundry, is covered by a perpetual layer of red dust that swirls off the trucks. Power goes out daily, and for longer, as the expanding mines suck up capacity from an overloaded power substation.
The town needs new roads, steady power, a share of the taxes generated by the mines, and a government that enforces environmental laws.
Under the Trump administration, none of those has yet materialized. The conditions under which gold is produced have remained. Only the gold buyer has changed.
El Callao’s mayor, Coromoto Lugo, told us that the local government receives the equivalent of about $20,000 a month from the federal authorities. That’s less than 1 cent a day per resident. That figure has not changed since El Callao’s gold started heading to the United States.
“All of the government’s plans for the gold sector have failed,” Mr. Lugo, who belongs to an opposition party, told us.
U.S. officials have called the deal historic, and people familiar with its terms say the Venezuelan state now reaps market prices for its gold, rather than selling it cheaply to bypass economic sanctions.
With Mr. Trump’s support, global trading firms swooped in and cut deals to export semifinished gold bars. That investment has not trickled into the community.
Residents take to El Callao’s streets almost daily to protest the blackouts. During our visit, protesters blocked the only paved road connecting El Callao and other gold mining hamlets to the outside world, effectively bringing the region to a halt.
The protest reflected the modicum of freedom that Venezuelans have won since Mr. Trump toppled Venezuela’s leader, Nicolás Maduro, in January, and turned the country into an American protectorate. Under Mr. Maduro, paramilitaries or gangsters would have broken up the protest in minutes, residents said.
But living conditions remain bleak. We watched children and teenagers toil in rudimentary gold processing plants, in open violation of labor laws. Those plants use mercury, a toxic liquid banned under Venezuelan law, which poisons water supplies.
More than a dozen miners told us that the work was slowly killing them. They had few illusions of finding a rich gold vein and retiring in comfort. Gold mining was the only job that allowed them to make a living in a country devastated by one of the steepest economic collapses in modern history.
Limited state presence has been exploited by the local organized crime syndicate, which holds the real power in town. Mine workers readily admit to paying protection money to the dominant gang, El Tren de Guayana, to work.
The locals call the extortion racket “el sistema” — the system. Many see it as a reasonable tax that pays for services that the state long ago stopped providing. The gang’s leader, known as Ronny Matón, or Ronny the Killer, mitigates legal disputes and punishes common crimes, such as theft and domestic violence, the residents said.
Venezuela’s mining ministry did not respond to request for comment.
The Trump administration intended, with its oil and gold deals, to weaken the power of the gangs. Earlier this year, U.S. and Venezuelan militaries jointly killed a leader of another gang farther south.
In the rest of the mining region, gangs continue calling the shots.
A few years ago, the government broke up the labor union at Minerven, the state gold mining company. It was part of Mr. Maduro’s campaign to snuff out organizations outside his control.
Without collective bargaining, Minerven’s miners lack life and disability insurance, yet work as much as a thousand feet below ground amid toxic gases and explosions. Three Minerven miners died in separate labor accidents in the past year.
Anderson García, 42, was crushed to death by a falling rock in the Mina Colombia mine in January.
Mina Colombia is one of two mines that supply gold to the United States.
“It is an inhumane environment, full of threats and dangers,” Mr. García’s father, Cifrando García, said in an interview. “Today it was him; tomorrow it will be somebody else.”
Mr. Lugo, the mayor, says foreign powers have long tried to capitalize on Venezuela’s gold riches. “The Iranians, the Russians, the Chinese — they all eventually left,” he said.
Now, he added, it’s the Americans’ turn.
Isayen Herrera contributed reporting from Caracas, Venezuela.
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