SITUATION ANALYSIS OF THE SMALL-SCALE GOLD ... - WWF

The CBvS executes little control on the various steps of the chain. Initially an inspector
was stationed in each gold buying agency. This strategy did not function because many
agencies bought after-hours, when the inspectors were gone. Moreover, it became
impossible to position a Bank representative in each and every buying center after the
market for buyers had opened. At first the CBvS continued to send inspectors for random
unannounced checks, but this strategy proved not adequate because these checks only
took place sporadically and during office hours.
Today the CBvS merely relies on the honesty of the gold buyers and exporters. A highranking
official at the CBvS said he believed there is little reason to smuggle because the
CBvS asks such a small share (1%) of potential earnings in royalty. On the other hand, he
also acknowledged that the regular arrests of individuals –mostly buyers- who are
smuggling gold out of the country suggest that this trust is being violated.
6.2 Licensed gold buyers
Only buyers licensed by the CBvS (CBvS) are allowed to buy gold from miners. Buyers
have to be Suriname firms, though many work in partnerships with Brazilian companies
in the so-called juridical form of a Naamloos Vennootschap or NV. The partly Brazilianowned
firm Ourominas was the first legal buyer to enter the gold market since the CBvS
began purchasing gold in 1994. In 1997 more legal buyers were invited to the market,
and gold purchasing became more efficient and better registered. Since 2002 the market
is open to any firm with the appropriate gold purchasing license.
There are no buying agents in the mining areas. The buying centers in Paramaribo may
have their connections in the interior, but they find it too dangerous to establish a post in
the forest in the absence of police and military protection or other law enforcement.
There are some buyers who will send their personnel to the interior to buy, but these
agents do not stay overnight. In the period 1997-2004, legal dealers purchased on
average 6941 kg of gold/year, ranging between 2,531.8 kg of gold in 2002 to 1,2738.5 kg
of gold in 2004 (Table VI.1).
Gold miners select their buying center on the basis of the price offered, reputation, and
familiarity. Brazilian miners typically sell at firms with a Brazilian connection and
Brazilian(speaking) personnel, such as Ourominas. The buying agent buys the gold,
cleans it, makes it mercury-free, and determines the gold-content, before he will
determine the price to pay to the miner. When the CBvS was still involved in buying, it
deducted 2% for overhead costs (administration, transport, control) and 1% in royalties.
Today the individual buyers decide how much administrative costs they calculate in
addition to the 1% royalty. The buyer sells the gold on to the exporter.
6.3 Jewelers
In 1998, about 2,700 jewelers and gold companies were registered at the Chamber of
Commerce. The Central Bank has asked jewelers, most of who are of Chinese descent,
what amount of gold they would need for production. The reported figure was very low
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