From Nation, page 11, issue no. 342, November 19th 2007
Translated by Zuo Maohong
Original article: [Chinese]
Fresh after returning from Purang county in Tibet's Ngari prefecture, Liu Mingwei, a gold miner, is already busy preparing for his next expedition.
"Normally it's the time of the year for miners to go home," says Liu, adding that they usually don't go to mineral rich regions such as Xinjiang, Qinghai, and Tibet until April or May, when the frozen rivers and lakes have thawed.
But things are different this year. Fortune chasers in the town are increasingly reluctant to abandon their search as gold prices continue to surge.
Liu's hometown, Liuduzhai, in Longhui county of Hunan Province, was widely regarded as "the city of gold" in the 1980s. But its era passed with the exhaustion of its gold resources, and gold speculators based there are now taking their skills and experience and heading off to the farther corners of China's gold-rich regions. Many go to Yunnan, Sichuan, and nearby countries like Burma and Vietnam. Liu's next destination is Luoyang in Shaanxi province-- "I have friends who are already [mining gold] there... they say it's not bad." While Liu was preparing to depart, the price of 99.99% pure gold was on the verge of breaking the record of 200 yuan per gram at the Shanghai Gold Exchange. Gold prices have grown 20 percent over the last two months.
The First Golddiggers in China
When gold was discovered during the canal-digging for the construction of the Liuduzhai reservoir in the mid 1970s, Liuduzhai became a hot spot for gold digging. As one local, Wang, recalls, "the canal was filled with people. The banks were dug up, even nearby farmland didn't survive."
At the beginning of the 1980s, gold dust from Liuduzhai sold for eight to ten yuan per gram, which attracted batches of businessmen from all over the country and earning the name of "the city of gold"-- which was later borrowed by a local businessman made wealthy from gold when he named a luxury hotel he built there.
At the cost of ruined rivers and farmland, the town reared its first batch of rags-to-riches golddiggers. After the town's 1.44 tons of gold was exhausted, professional gold speculators took their honed skills, abundant experience, and accumulated capital and began searching elsewhere. The gold rush thus spread to Heilongjiang's Mohe River and Xinjiang's Aletai.
"There are always our people in places where gold mines exist," says Liu Wenhua, an official of the Liuduzhai government. Every early spring, one can meet gold miners speaking a Liuduzhai dialect on trains bound for areas like Xinjiang, Tibet, Yunnan, and Heilongjiang. But their footsteps are not limited within the national borders-- they travel as far as Burma, Vietnam, Laos, Russia, Kirghizia, Kazakhstan, and Mongolia.
Chasing Fortunes
Liu Honglong, who once mined gold in Xinjiang, Tibet, and Shaanxi, says that numerous fellow townsmen have made fortunes in this way. "It only takes three to five months to make ten million or even a hundred million yuan by investing several million in gold dust," he says.
According to Liu, the most successful example is a man named Liu Pingjian. With several billion yuan made from gold mining in the early years, companies at gold producing regions all over China, and a gold mine in Tibet which is producing 500 grams of gold every day, the former tractor driver is now the richest in the town.
"Most young men in Hunan choose to work as laborers in cities along the coast. But few in Liuduzhai do so, instead, they work for the gold traders." says Liu. Salaries vary from 1,200 yuan to 5,000 yuan according to different types of work-- above average in the industry.
Even government officials can't resist the lure of wealth, he says. To join the gold rush, some have asked for leave, others even quit their jobs outright. One example, according to Liu, is the now-deputy mayor of the town, who has invested several hundred thousand yuan in gold mining and made a profit of approximately five million yuan in the same year.
Unborn Costs
According to regulation, gold mining is only legal after permission of local land and resources watchdogs, registration in administrations for commerce and tax, and, most importantly, approval of environment conservation departments.
A source who works in Hunan's land and resources department and wishes to remain anonymous says that it's almost impossible to permit such gold mining according to these miners' mining skills and the extent of harm that they are doing to the environment and natural resources.
One miner, who wishes to remain anonymous, says that nearly all of these who are still doing the business gained government permission by false reporting and "sealing government officials' mouths with money". For example, one of his mines, which is located in a natural reserve in the northwest, had been shut down before but is operational again under the guise of being a reforestation project.
He adds that government watchdogs frequently visit them to "investigate", and are always greeted by a hongbao, that is, cash wrapped up in red paper, usually with one or two hundred thousand yuan in.
Loan sharking has also brought trouble to the town. According to Liu, some locals won't dare to return after borrowing money at high interest and losing it all in the business. "Although things are not bad to the point of murder or arson, beating debtors is a common thing," he says.
