El Salvador approves new mining law to exploit $3 trillion gold

On December 23, the Legislative Assembly of El Salvador passed a new mining law, effectively lifting the ban on metallic mining that had been in place since 2017. 

This legislation allows for the exploitation of gold and other metals, a move supported by President Nayib Bukele's party, Nuevas Ideas. 

The new General Mining Law grants the Salvadoran government a monopoly over metallic mining activities, enabling it to form partnerships with private companies for resource extraction.

Bukele has previously criticized the ban as “absurd,” arguing that El Salvador is sitting atop a $3 trillion gold reserve that could significantly improve the nation's economy. 

“It is imperative that the state make rational use of the wealth available in its territory and use it to improve the quality of life of the population in general while respecting the environment,” he stated.

While the law prohibits the use of toxic substances like mercury in mining processes, environmental activists remain skeptical about its potential impact. 

Andrew McKinley, an environmentalist, warned that the extraction process could lead to severe environmental degradation, stating that it could “turn El Salvador into the Moon with its craters everywhere in a very short period.”

Critics also question the validity of Bukele's claims regarding gold reserves, with Pedro Cabezas from Acafremin suggesting that such figures might be exaggerated.

In response to these concerns, Bukele has invited international geologists to evaluate El Salvador's gold deposits and assess extraction possibilities.

The approval of this law marks a significant shift in El Salvador’s approach to its natural resources, moving towards economic exploitation despite environmental risks.