MACDESA: A Fairtrade Success Story

Posted by Jon - 03 March 2018

Fairtrade’ is a term and brand we are all very familiar with here in the UK.  It started with bananas and swiftly grew to include more products that we regularly put in our shopping baskets including tea, coffee and chocolate. Fairtrade gold has been going from strength to strength since the first shipment of South American gold in 2011, through to 2017 when the first African Fairtrade gold came to the UK from Uganda. 

This is the story of the MACDESA mine in Peru; a story of determination and success.  They literally walked out into the desert to find a place to build a better future for their children and community. 

MACDESA, Peru
(Minera Aurifera Cuatro de Enero),

“Investing in people is the best investment you can make. With Fairtrade it will be possible to do much more”

For Santiago Ramirez, his village Cuatro Horas (Four Hours) is not just a reminder of how long it took MACDESA’s original miners to walk into the desert to reach the mine they would later found. It is a continuing symbol of just how far their unfaltering determination has brought them.

Located in the bleak Chaparra district of Peru, MACDESA began its Fairtrade journey in 2009 on learning about the foundation and achieved certification in May 2015. Today this helps the mining society supports 350 employees as well as 600 people from Cuatro Horas community and the surrounding areas.

TOUGH BEGINNINGS...

During the late 1980s and early 1990s, artisanal mining became the main source of work in southern Peru. Despite inhospitable surroundings and a lack of food, water and shelter, there were around 900 men working independently at the mine in Chaparra by 1997. Originating from areas where traditional gold mining dated back to the Incan and Spanish eras, many knew no other way of life.

The men worked exhausting 12-hour days relying on sheer strength and very basic tools such as sledgehammers, picks and shovels. Like most artisanal miners, they processed the gold using mercury without protection. Since up to 50% of the gold was lost at the beginning due to the method, this was not only uneconomical but also hazardous to health and environment.

After all this, the miners were barely making enough to pay their daily expenses because buyers refused to pay more than 60-70% of the gold’s value.

An initial attempt at forming an association was not easy, building a common vision and objectives took time, but the miners did learn that uniting led to greater results. The first effort was their own association (ADEMIC) composed of all the miners, but in time some members left. 350 miners then went on to establish the company MACDESA in 2004

BUSINESS DEVELOPMENT ...

From the start, its director’s demonstrated investment was the best way to progress. After buying the first truck in 2007, MACDESA went on to mechanise practices in the mine, buy new machinery and mills and even set up a processing plant. Rather than 5 tonnes of material a day, the miners were processing 120 and became capable of delivering 25 kilos of gold per month. Workers were carried by bus to the mine and had personal protective equipment (PPE)

Fairtrade certification was essential to furthering these developments. Under the Fairtrade label, MACDESA now sells 100% of production to trustworthy, international buyers offering fair prices. Using its Fairtrade Premium – the $2,000 given per kilogram of gold on top of the product price – MACDESA hopes to provide business training and courses to cultivate personal skills. It also wants to gain new concessions, acquire equipment with bigger capacity and increase income.

On top of water, drainage and electrification projects, Cuatro Horas has used funding to rebuild the village following an accidental fire in 2014. 80% of the area was damaged leaving some 300 houses in ashes and the school impaired.

The shareholders now want to provide their children with a better school that has Internet access and the health centre desperately needs surgical and X-ray equipment for the surrounding region. Currently the nearest city with such facilities is 300km away.

From desolation to dreaming big, MACDESA is aiming to become a Fairtrade role model.

“As a company, we want to keep developing to become a leader at national and international level. As people, the development means having better conditions for our families.”

Santiago Ramirez