There was a curious after effect to the 2008 global financial crisis – deforestation. As the stock markets started to crash, unleashing a new wave of uncertainty across the world, people started looking for other kinds of assets that offered them a sense of certainty and stability. As the market bulls turned into bears, many started to find solace in an age-old, sparkling asset – gold.
An increasing demand for the yellow metal, fuelled by this behavioural pattern, led to an increase in mining activity – forests were cleared to dig up gold, settlements were built to accommodate miners, and roads were made to facilitate transport. A study, conducted by Nora Alvarez Berrios and T. Mitchell Aid of the University of Puerto Rico Rio Piedras, using satellite imagery, shows a dramatic increase in deforestation – about 650 square miles of moist tropical forest was lost to mining in South America alone.
Through the ages, our lust for gold has had a disastrous impact on the environment in many ways – deforestation is just one of them.
The majority of the world’s gold is produced by scouring huge volumes of earth and extracting trace elements from it. The waste from extraction processes carries mercury and cyanide, chemicals used to extract gold from rock. This process, known as ‘Open pit mining,’ does irreparable damage to the environment. As mercury and cyanide get washed into the rivers, they clog and decimate the marine life.
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