Propositions for a sustainable Artisanal Mining in Southern Africa

Claude KabembaDirector

Southern Africa Resource Watch

Objectives

• Assist Government, artisanal miners and communities achieve sustainable and sound social, environmental and economic stewardship in the ASM

• Provide guidelines on how to manage pivotal mining pillars in this mining sub-sector.

• This work was done by the Ali-Douglas Research Network, IDS-NUST and LSU. ADRN, Bulawayo.

Rational• A lot of work, analysis, solution propositions have been made to

transform the ASM into a developmental sector. –change has been slow

• The AMV has identified the ASM as critical sector capable of contributing to economic development of countries, especailly of communities where it takes place.

• If properly organise, ASM can create jobs, source knowledge creation, source technological innovation and advancement, and promote industrialiazation

• For these reasons, the sector requires constant and effective evaluation and monitoring , and improvement of the tools we use.

The Resource barometer

• The propositions found their foundation in the resource Barometer (www.sarwatch.org)

• Create a regulatory framework to promote a sustainable ASM by safeguarding social, environmental, safety and health concerns,

• Decentralise the management of small scale mining in terms of issuing of mining rights and taxation, monitoring and sanctions.

• Pass strong legislation on the safety of vulnerable population, especially women and children

Artisanal Mining Propositions

• Five pivotal pillars– Ownership– Venture registration– Mineral production and value addition (where

necessary)– Mineral Marketing– Exit strategy

• Each of the pillars has operationalisation guidelines on how best to undertake activities in each pillar.

Ownership

• Local institutional arrangements that govern ASM usually lack financial resources and personnel to effectively monitor the sector. This weakening of common property regimes by the states has unfortunately resulted in an open access system that has witnessed indiscriminate extraction of minerals from any geographical location (DISORDER)-

Ownership: Recommended principles and guidelines on property rights

• Government should have an updated geological and land use survey so that it is aware of areas that are potentially rich in minerals. Settlements in such areas should be discouraged to ensure that people do not lose their homes and infrastructure once those areas are identified for extraction purposes. ( EX: KASULO)

• Land and all natural resources that are not privately owned belong to the state, the state must devolve enough control powers to local government structures to ensure that there is effective control of mining activities done within and by communities.

• Common property ownership rights should be promoted and respected by the state to ensure that local institutions play an effective role in managing and monitoring thus preventing resources from falling into a tragedy of commons situation.

• National laws, regulations or Acts must ensure that property rights are respected. Additionally, in the case of privately owned land, the law must ensure that the owner also benefits from extraction activities through some share ownership agreement to ensure that he/she does not bear the costs of rehabilitation alone.

• Governments should enact laws that enforce benefit sharing on resources extracted from land under common property ownership. Such laws should also benefit vulnerable groups who cannot practice mining.

VENTURE REGISTRATION• Artisanal mining in many developing countries is characterised by

widespread informality with the majority of miners operating outside the confines of the institutional environment.

• Literature shows that due to the institutional irregularities, the voices of artisanal miners have been excluded from most deliberation about their mining activities.

• The illegitimacy/ criminalisation of artisanal miners limits their contribution to the national coffers, makes them vulnerable to abuse and unfair treatment.

• The crimiminalisation push artisanal miners underground making formalisation difficult with all the social and environmental problems.

• The propositions consider artisanal mining registration and formalisation as a multi- staged process involving Recognition and Amnesty, Actual ‐Registration, Prospecting and Pegging.

Recognition and Amnesty

• As the first point of call towards formalisation, there is a need for governments to recognise the existence of artisanal mining, its contribution to livelihoods and poverty reduction=development. Recognition will see the activities of artisanal miners incorporated into formal institutional structures thereby making the sector easier to manage.

Recognition and Amnesty: Recommendations

• Define artisanal mining and its constituents at national level, in collaboration with relevant local stakeholders, including artisanal miners

• Enact enabling institutional frameworks that recognise artisanal miners of diverse definitions.

• Announce amnesty to all illegal miners and disseminate such information, to facilitate formalization.

Actual Registration

• The costs of registration in many countries are perceived as high, due to the extensive institutional requirements. Such costs push many of small- scale miners into illegal ‐activities. Therefore, the registration process must be simple and affordable to all miners.

Registration: Recommendations• Opening local offices for mining regulatory authorities• As a part of obtaining “Social Operating License” that will

facilitate social corporate responsibility (SCR), Local community leadership should recommend prospective miners for allocation of mining claims (no recommendation no claim).

• The final prospecting license should be obtained on the basis of the community recommendation letter.

• Prospecting in private lands should involve the owner of the land

• Prospecting fees have to be affordable and in sync with national laws

Pegging

In most of Southern Africa, this stage usually comes before the actual mining commences. There are a number of processes to be followed at this stage. After prospection, a claim has to be pegged by the relevant authorities. The authorities in most countries include those that regulate environmental stewardship, agriculture, water amongst others.

Pegging: Recommendations • The supervision of the multiple requirements has to be devolved and conducted

by trained local people under the supervision of the authorities in order to minimise costs and limited government human resources.

• The process should also involve discussions between the local community members and the prospective miner

• Develop a legal framework that will enable the reclamation of mined lands. Hence, prior to the miners being presented with mining licences, they should commit to paying a certain amount of money as a good tenancy deposit (determined by relevant experts) over a specified period of time. This money would be used to rehabilitate the environment should the miner fail to do so. However, should the miner rehabilitate the land s/he may reclaim the money. The money may be paid during the course of production

• Local mining office should issue mining license and environmental license after the multiple requirements have been met with the approval of the community leadership.

MINERAL PRODUCTION

Small and isolated deposits of minerals are scattered in and between countries across the continent. These often lend themselves to economic exploitation by small- scale miners with modest ‐demand on capital expenditure and a short lead- ‐time. They also provide employment opportunities for the local population. Contemporary production processes employed by artisanal miners are synonymous with environmental degradation.

Recommendations

• The propositions divides the artisanal mining production process into FIVE major components that are equipment concerns; industrial support; capacity building; the institutional dimension and community monitoring

Equipment/approach

The mining production process uses multiple inputs that are potentially harmful to the natural environment and human life. Thus, the practice of artisanal mining• has to be undertaken using the latest knowledge from scientific research on

environmentally friendly productions inputs• Miners must use latest efficient methodologies that allow for the millings of

ore on cite in order to facilitate and simplify the filling of pits• In addition to environmentally friendly inputs, a continuous process of

research into more efficient portable machinery is required• Sources of water must be present in order to facilitate production• Mining activities must be biased towards methods less harmful to the

environment such as shaft mining• Mills must be in close proximity to the mines to avoid transporting ore over

long distances

Industrial support

• Artisanal miners need to obtain support (capacity building; equipment; etc.,) from larger firms in the industry within the vicinity (this may be done through community share ownership trusts and other forms of institutional support).

• Established mines and artisanal miners should thrive to create a win- win ‐relationship

Capacity building

• Artisanal miners should receive regular training on entrepreneurship

and mining venture management; operation of latest customised

equipment; environmental management and the ruling institutional

framework

• The community that hosts the artisanal miners must be regularly

trained on issues related to the negative effects of child labour;

harmful chemicals in mining; the mining value chain and

environmental degradation in mining

Institutional dimension

• Artisanal miners must be aware and clear regarding the institutions that govern their activities in order to avoid duplication and corruption.

• Environmental management authorities should regularly monitor mine activities through trained community based individuals/committees

• Collection of portions of the good- tenant security deposit must be ‐undertaken during the production phase of the mining venture

• Collection of potions of any community income remissions must be undertaken during the production process

• To promote sustainable production, dedicated financial support from a devoted financial institution or department within a financial institution is a requirement.

Community monitoring

• A dedicated community committee on mining activities should regularly monitor production activities based on preliminary the group discussions with prospective miners specifically in:

• Disallowing and reporting the use/misuse of certain chemicals in Mining in agreed areas

MINERAL MARKETING• In spite of the serious economic ramifications of illegal marketing of

precious minerals, a sizeable chunk of high value mineral sales from artisanal and small- scale‐ miners is done through parallel or black markets

• Artisanal miners are generally poor people and as such subscribe to a subsistence economy where daily subsistence is dependent on the minerals mined. This means they expect quick returns from their investment into mineral extraction.

• Furthermore, artisanal miners rely on middlemen to market their minerals.

• Similarly, as a result of the illegality of artisanal mining, inefficiencies in transportation, long trading chains amongst others, only a minute part of the wealth generated from mining reaches the miner

MINERAL MARKETING• For the miners to get fair prices and to detract against the use of parallel

market channels for the minerals mined it is critical that access to official markets be put at the core of formalisation strategies. In this vein, providing simplified access to recognised buying channels can help miners increase their income and bring the mineral production into the formal economy

• Whilst it is prudent for a country to have a central buyer of high value minerals for accountability and security purposes, it is not desirable to maintain such an arrangement if leakages of these minerals is to be contained. Thus, it is necessary for the central buyer to appoint its official agents who will operate from the communities ensuring that they always provide the ready cash to the miners

• The designated buyers of any high value minerals should buy the minerals at reigning international market prices

MINERAL MARKETING• The central buyers of minerals can enter into pre- financing arrangements with ‐

the miners to deter the miners from brokering similar deals with unscrupulous intermediaries. Through this kind of arrangement, the licensed agents can assist the miners with financial capital required for operations with the miners selling their minerals exclusively to these buyers

• With the maturing of marketing systems, countries can consider adopting ethical certification in order to give artisanal and small- scale miners the opportunity to ‐trade their minerals under better selling terms and conditions. This will also encourage miners to produce minerals according to a set of standards (including environmental, social and ethical standards). This can be done in conjunction with established certification syndicates such as Fair trade and Fair- ‐mined Gold, the Responsible Jewellery Council and Initiative for Responsible Mining Assurance (IRMA) amongst others

Mineral Marketing• It is also worth exploring synergistic relationships between

artisanal miners and large- scale miners in areas where there ‐are vibrant large- scale mines (LSM). In this arrangement ‐artisanal miners can be pre- financed by LSM and the ‐artisanal miners in turn sell their minerals through the LSM

• There should be no lower limits placed on the amount of minerals that can be sold to the central buyer or its agents

• Production and selling records for each miner should be maintained or at the very least accessible to designated local authorities superintending over the mines in the area.

Exit Strategy

• Improper mine- closure and lack of ‐reclamation can lead to serious environmental ills. In light of all this, measures need to be put in place to ensure good practice in winding up of artisanal mining activities

Land reclamation

• Artisanal miners should present their envisaged process/plan of land reclamation to the community leaders before commencement of mining itself

• To be effective and sustainable, the efforts to reverse environmental damage and restore productive activities should be agreed on in collaboration with the communities. It is very critical for the communities (including vulnerable groups) themselves to have a strong sense of ownership of the process

• Reclamation should not just end with filling up pits, but should be followed up immediately with secondary activities such as agricultural production, to give people an incentive to refrain from re- mining the reclaimed land.‐

Good tenancy deposit

• A good tenancy deposit should be collected from the artisanal miners that will be liquidated upon satisfactory of land reclamation efforts. The good tenancy deposit cannot be lower than the cost of reclamation and the rate charged should be directly linked to the scale of operation.

• Part of the good tenancy deposit will also go towards payment of royalty fees that will be used to assist the vulnerable groups in the mining communities.

Clearance process with authorities

• Upon finishing the mining activities, the miner should also seek clearance by the authorities across board. The local authorities should consult with the rest of the community to establish whether the miner fulfilled the requirements before exiting. Upon, satisfactory consultations and observation, the local authorities can then clear the miner and give a written and stamped letter of clearance.

• The miner can then produce the clearance documents upon claiming the good tenancy deposit from relevant authorities.