Miners' dream of riches ends in pain, fear and poverty

Ghana's gold rush seemed to offer all a Shanglin miner could hope for, but the chase for wealth produced a nightmare for many

PUBLISHED : Tuesday, 09 July, 2013, 12:00am
UPDATED : Tuesday, 09 July, 2013, 7:28am

Like many natives of Shanglin county, Wen Yonglin imagined returning home from Ghana with wealth beyond his dreams.

Instead, when he arrived back in his hometown after three weeks in hiding in Africa, the 34-year-old miner carried nothing more than a simple travel bag and faced debts totalling more than 500,000 yuan (HK$625,000).

In Guangxi Zhuang autonomous region, where his home is situated, GDP per capita last year was just 27,832 yuan, according to Deutsche Bank research.

Sino-African relations have been in the spotlight in recent years, even more so since March when President Xi Jinping, signed trade deals worth billions of US dollars as he toured Tanzania, South Africa and the Democratic Republic of Congo.

It seemed a marriage made in heaven. Africa has the resources China craves. Meanwhile African governments have a new source of development aid less likely to ask questions about human rights and political development than their traditional patrons in the West.

But in Ghana, the honeymoon period did not last long.

Early last month, Ghanaian authorities detained hundreds of Chinese in a crackdown on illegal mining. Meanwhile, locals began looting and attacking wealthy Chinese miners.

Ghana is Africa's second biggest gold producer behind South Africa, but the government in Accra wants to oust illegal foreign prospectors - most of whom are Chinese. Of the 50,000 Chinese in Ghana, the majority are, like Wen, from the impoverished villages of Shanglin.

The Chinese gold rush in Ghana started in 2006. As word spread of the easy fortunes made by the early adventurers, thousands started to flock to West Africa to strike gold. At its peak at the end of last year, more than 2,000 small gold mines were run by Shanglin people in partnership with local owners.

But times have changed. Like Wen, thousands are fleeing. They say anyone of Chinese appearance has become a target for robbery and attacks by local gangsters and even armed police. Despite requests for protection from Beijing's Foreign Ministry, the violence has continued.

"No, the Chinese government has done nothing to help and it seems out of control and dangerous. Almost all hotels, supermarkets and restaurants run by Chinese people have been robbed by locals," Wen said.

"They think robbing and attacking Chinese is allowable and in line with justice because both Ghanaian and Chinese governments announced the Chinese were illegal and mining in the wrong way in Ghana."

They think robbing and attacking Chinese is allowable and in line with justice because both Ghanaian and Chinese governments announced the Chinese were illegal and mining in the wrong way in Ghana

According to the embassy of Ghana in China, its government has set up an inter-ministerial task force to tackle illegal mining, including seizing all equipment and arresting, prosecuting and deporting non-Ghanaian miners and revoking the licences of Ghanaians who have sub-leased their concessions to non-Ghanaians.

Since last month, about 20 or 30 gold miners have returned to Shanglin from Ghana each day.

"If you see a lonely and sorrowful man coming out of the county's bus station with dark skin and a small suitcase, he is definitely from Ghana," a local coach driver said.

"I was lucky to leave, but thousands of Chinese are still trapped at Accra waiting for air tickets. The price of one ticket has been soaring from US$1,000 to US$1,600 ," said Huang Guolong, another gold miner who came back to Shanglin on June 21.

"All of the money I carried, [Ghanaian] cedi or US dollars, was seized at the airport. Now I can feel nothing, but only pain and fear. There are thousands of Chinese still in danger in Ghana. They really want to go home but where is our government?" Huang said.

"Why do mainland media not cover the truth that thousands of Chinese have been robbed and shot, injured or even killed in Ghana? Why, when the Chinese embassy in Ghana knows we are already penniless after being robbed, does it abandon us in danger? Why has the Chinese government sacrificed its people overseas?" Huang asked. He said thousands of trapped Chinese wanted an official evacuation. Su Zhenyu, secretary general of the Chinese Mining Association in Ghana, said Chinese miners had invested many billions of yuan in Ghana since 2006, with each of the 2,000 gold mines they were operating costing about three million yuan to set up.

"Most of these people became bankrupt because of the mass robberies and the seizure of all of their equipment," Su said.

At the peak of the gold rush, between June last year and March this year, Su said thousands of Shanglin people borrowed money from banks and relatives, investing about 1.8 billion yuan in 600 mining equipment kits. Each kit costs at least 3 million yuan, including excavators to dig sand, trucks and high-powered sand pumping machines to dredge for alluvial gold.

Mainland media outlets report that banks lent more than 7 billion yuan to prospective gold miners in recent years - in a county where the local government's total revenue for last year stood at just 300 million yuan.

"Businessmen, teachers, jobless young men and even local officials - almost every family in Shanglin - tried to borrow money from local banks and relatives to invest in gold mining in Ghana. In my township, only men with physical problems don't have plans to go to Ghana," said Wen, who was previously a gold miner in the Guangxi city of Yulin.

He quit his job and borrowed 400,000 yuan in August so he could join three friends in setting up a small mine in Dunkwa in central Ghana.

"At that time, we all thought Ghana was full of gold and opportunities. Actually, I and my partners lacked mining experience. Until December, we paid the owner of the farmland about 30,000 Cedi [HK$115,000] for land-use rights to about 10 hectares of farmland. But the land could only produce about 110 grams of gold each day while we heard some got lucky and produced up to 300 or 500 grams a day," Wen said.

After deducting costs, including diesel, labour and paying 20 per cent of gold production to the local chief, Wen and his partners were left with 20 grams of gold a day. Their plight worsened last May as a crackdown by officials and police began.

"What we earned in Ghana was far from what we needed to recover our investment. And now, all our machines have been burned and destroyed by locals," Wen said.

At first, Wen did not want to leave his investment behind. He and his partners spent three weeks hiding in forests and villages as armed police raided mines, supermarkets and hotels in nearby cities.

However, further robberies and attacks by locals crushed their dreams once and for all.

Wen and his partners left their multimillion-yuan excavators, trucks and pumping machines and the burned-out mining site and headed to the airport.

Those machines now represent not hope, but debt.

"There are about 700 people in our village and almost all male adults aged between 18 and 50 went to Ghana," said Zhou Shunlong of Mingliang township, Shanglin. Zhou was among 14 male members of his family, including four brothers, cousins and nephews, who worked in Ghana since 2009.

"Our family lost about 20 million yuan of mining equipment in Ghana, including about 30 excavators," Zhou said. "My family was among those early adventurers mining in Ghana. Many neighbours in my village took out loans and went to Ghana after hearing our stories.

"By my estimate, besides the investments my family made, the people of my village have lost about 30 million yuan in Ghana."

But despite their troubles, many see a return to Africa as their only route out of debt. Every person the Post spoke to in Shanglin said they would set foot in Africa again in the hope of turning another resource-rich country into the "next Ghana".

"I would definitely travel to Africa soon. Shanglin is too poor. It would be impossible to pay my debt of 500,000 yuan if I worked as a farmer or a migrant worker on the mainland," Wen said.

"We learned a lot from Ghana's lessons. We learned the skills of mining and communicating with locals in Africa. Raising money for necessary equipment and travelling to Africa is the only hope for us."

Zhou also plans to be a pioneer once again.

"I tried to run a small gold mining site in Madagascar last year, but too many Chinese poured into Ghana," Zhou said.

"I felt the Ghanaian authorities would do something to stop the Chinese gold rush, either sooner or later.

"But the situation in Madagascar was very unstable and its government officials' behaviour was corrupt … I lost about three million yuan of investment there," he said.

"My brother is now moving the equipment from Madagascar to Cameroon. I heard there were about 10 Shanglin gold miners running gold mines there. Cameroon's policies and people seemed friendly and welcomed Chinese investment. It might be virgin soil for us.

"But no doubt we will try our best to toe the line and be legal in Cameroon," Zhou said. An agreement with the government of Cameroon and registration under the embassy of China are the priorities for Zhou's next trip.

"I will go to Cameroon with a travel visa, but will turn it into a work visa as soon as I set up a company there. Two months later, I might start running a mining site again in Africa."