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The critical importance of formalising the ASGM sector

There is an urgent need to formalise the artisanal and small-scale gold mining (ASGM) sector. While policies have been promulgated and guidelines on formalising the ASGM sector have been drawn up, the relevant regulatory oversight and enforcement mechanisms must keep miners within legal frameworks so as to decouple the gold supply chain from the mercury trade and foster the development of sustainable gold mining.

Twenty per cent of global gold production is attributed to ASGM activity, with at least 190 million people directly or indirectly dependent on the sector. While ASGM has positive spillover effects on rural economies, it is also responsible for extractive methods that volatilise 1,000 tonnes of mercury emissions annually ​— making it the single largest source of anthropogenic mercury emissions globally. Besides the harm done to the environment, mercury emissions may also cause grave health complications that include permanent brain damage, seizures, vision and hearing loss, and delayed childhood development. 1

Around eighty per cent of miners in the ASGM sector are in the informal space and may not fully understand the risks of mercury. 2​ These miners may also not have access to equipment and the protective gear to handle mercury. It is a major sustainable development challenge because the continued presence of mercury in the gold supply chain has compounding repercussions.

Stricter regulations on mercury usage may allow for gold to be eventually dehubbed from the dangerous mercury trade. 3 An ​environmentally-friendly and non-toxic gold recovery reagent by Clean Mining currently exists, and this may also help ASGM outfits mine for gold cleanly without the need for toxic mercury.

Besides the issue of mercury usage in ASGM, miners in the informal space may not have legal protections and lack open access to finance and capital. This may make them susceptible to corruption and criminal activities. 4​ Formalising the sector is important to make it viable and sustainable. The ultimate aim of formalisation is to reduce poverty rates, create jobs, improve working conditions, and allow more capital to enter the ASGM sector. When countries embark on the formalisation process, there can be regulatory oversight on ASGM outfits and enforceable laws to ensure the compliance of all parties.

It is important to highlight that artisanal mining activities may be carried out by people displaced by conflict. These are vulnerable individuals living in a state of precarity, and the pandemic and resulting economic crisis in developing countries could contribute to heightened community tensions in already fragile and conflict-affected communities.

A number of initiatives, such as the Extractives Global Programmatic Support (EGPS) trust fund by the World Bank, have been drawn up to support the formalisation of the ASGM sector in countries around the world. 5 EGPS grants, in particular, will promote long-term engagement and government policy reforms in the short and medium-term, and support existing work carried out by the World Bank in countries such as Afghanistan, Burkina Faso, Burundi, Central African Republic, Democratic Republic of Congo, Indonesia, Mali, Niger, Nigeria, and Tanzania. 6 This may help to address various concerns on education, labour, and the health of miners as capacity-building efforts can be launched to enhance the provision of such services. 7

The formalisation of ASGM is also in line with the ​United Nations’ Sustainable Development Goals (SDGs). These SDGs are a clarion call to governments, civil society, and the wider mining community to protect the environment, end poverty, and better the lives of people. By formalising the ASGM sector, there will be a viable path to decouple mercury from the gold supply chain and miners can work in a safe environment to create a sustainable future for the industry.

 

Clean Mining is part of the Clean Earth Technologies group.

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[1] For more ASGM statistics, see, “$180 Million Investment to Tackle the Hidden Cost of Gold,” December 23, 2019, https://www.thegef.org/news/180-million-investment-tackle-hidden-cost-gold​.

[2] For more on the issues surrounding the ASGM sector, see Morgane Fritz et al., “Global Trends in Artisanal and Small-Scale Mining (ASM): A Review of Key Numbers and Issues,” ​The International Institute for Sustainable Development​, 2017, https://doi.org/https://www.iisd.org/system/files/publications/igf-asm-global-trends.pdf​.

[3] See, for more on policies and formalisation benefits, Jorden de Haan and Brandon Turner, September 2018, pp. 11-12, https://doi.org/https://unitar.org/sites/default/files/media/publication/doc/formalization_handbook_e_web_final.pdf​.

[4] While most artisanal and small-scale gold mining activity is informal, this does not mean that it is unstructured. However, most of these activities take place outside the scope of government regulations, and this is an important point of distinction between informal and illegal ASGM activity. Only when mining activities are explicitly prohibited by law are they considered illegal. When miners operate in a “grey” environment where there are no legal frameworks, their activities may be considered informal. See, for more on challenges of an informal ASGM sector, “Formalization,” planetGOLD, accessed October 22, 2020, https://www.planetgold.org/formalization​.

[5] The Extractives Global Programmatic Support (EGPS) trust fund by the World Bank started as an emergency response for those in the ASGM sector that are impacted by COVID-19.

[6] Besides the World Bank, other intergovernmental organisations have also pushed for the formalisation of the ASGM sector. These include the International Labour Organization, United Nations Development Programme, UN Environment, United Nations Industrial Development Organization, and the Organization for Economic Co-operation and Development. Many governments have followed suit to gain more control and financial benefits, as well as alleviate tensions and stop the illegal trafficking of minerals. For more on the EGPS trust fund, see, “EGPS Launches New Emergency Relief Response for Artisanal and Small-Scale Mining Communities Impacted by COVID-19,” World Bank, July 29, 2020, https://www.worldbank.org/en/news/feature/2020/07/29/egps-launches-new-emergency-relief-response-for-artisanal-and-small-scale-mining-communities-impacted-by-covid-19?cid=eae_tt_energy_en_ext​.

[7] Formalising the ASGM sector involves integrating the industry with the formal economy, society, and regulatory system. There are major considerations for multiple stakeholders. For more on what formalisation entails, see, “Formalizing Artisanal and Small-Scale Mining for Inclusive Sustainable Development,” Intergovernmental Forum, November 30, 2018, https://www.igfmining.org/formalizing-artisanal-and-small-scale-mining-for-inclusive-sustainable-development/​.

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