19 an ounce), and Switzerland announced recently that it would be selling 54 percent of its holdings (which was followed by a price drop to $308 per ounce). Canada itself sold most of its gold reserves by the mid-1990s; it eventually slowed sales in late 1994.
Mining is a critical component of the Canadian economy, and a $CAN20 billion industry (representing 4.4 percent of the gross domestic product). It is the primary industry in more than 150 communities, and it is estimated that more than 340,000 people are directly employed in the mining industry; more than one million Canadians live in communities where mining is the primary industry.
The Mining Association of Canada was one of the first mining associations in the world to develop a national environmental policy. Developed in 1985 and updated in 1995, the policy commits its member companies to sustainable development. All new mining projects are subject to extensive environmental plans and financial commitments related to those plans, including developing the process for shutdown and reclamation. This is of particular importance to the gold mining industry, where cyanide is often used in the extraction process. While these environmental plans benefit society, they do so by adding cost to the mining process itself; as the price of gold drops, it comes closer to the extraction costs, which take into account not only the cost of removing the ore from the ground, but also the cost associated with environmental compliance.
Canada's gold mining industry is composed of many small organizations rather than a few large companies. Often, these smaller groups have international connections and joint ventures in other major gold producing countries, such as Australia and South Africa. In recent years, the declining prices of gold have forced a number of mergers and acquisitions in this industry, with the result that companies are increasing in size and also in their geogra...