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Gold for Development

Well-managed, transparent, and accountable resource extraction can be a major contributor to economic growth due to the creation of employment and business opportunities for local people. The mining industry has the incredible potential to dramatically develop rural economies. But without a proper capacity-building framework to stimulate economic activity and growth, it will be difficult to generate the outcomes that are essential for sustainable development.

Besides creating jobs directly and indirectly, gold mining also brings foreign direct investment, foreign exchange and tax revenues to countries. Often operating in remote locations, gold mining companies invest in infrastructure and utilities to support the needs of a gold mine. These improvements to roads, water and electricity supplies can be a long-term benefit to businesses and communities across the area, as these benefits outlive the productive years of a gold mine.

It is an imperative to not discount the provision of labour and raw materials for extractive industries in developing countries. An estimated 60 percent of the world’s population lives on less than 2 US dollars a day, and many people living in rural regions do not reap the benefits of globalisation even though they are an important driving force behind economic activity. 70 per cent of global gold mining output is carried out in these regions, and the artisanal and small-scale gold mining (ASGM) sector is a major source of income for many families. 1

Sub-Saharan Africa has an abundance of resources and a long history of mining. Mozambique experienced annual growth exceeding 8% from 1993 to 2010 — the fastest growth in a non-oil exporting country in the region. 2​ This was mainly attributed to its mining sector, but poverty reduction remained low as not many new jobs were created to benefit the local economy. 3​ Many vulnerable individuals, including women and children, turned to ASGM for income, and the sector was inextricably linked to connotations of hardship and precarity. 4

An estimated 90 percent of the worldwide gold mining workforce, or around 10-15 million people, are involved in ASGM. 5Many ASGM operations use mercury to extract gold from ore, and this is an especially hazardous process that inevitably leads to toxic mercury contamination of the environment. 6

More needs to be done to assist artisanal miners from hazardous working environments and limit the environmental damage to benefit future generations. While there have been calls to formalise the sector and support artisanal and small-scale gold miners, a trend of selective bias towards large-scale mining has emerged in the region. Foreign aid donors view ASGM activity negatively, while many local governments prefer the steady revenue stream provided by larger gold mining companies through land rent and permit fees. 7 This has led to an antagonistic relationship between ASGM outfits and the larger mining companies. With poor enforcement of legal rights and the limited space for small scale miners to operate in, this curtails the prospect of sustainable development opportunities for the local communities.

With proper governance and sound policies, trickle-down effects from the initial establishment of facilities can support the development of long-term infrastructure needs such as better housing, hospitals, and roads. 8Governments should initiate policy approaches that galvanise multinational gold mining enterprises to do more for the communities they operate in. This can be done through institutional reform or outright legislation of how mining companies should work with the local community to determine and develop key infrastructure needs. 9​ Current ASGM operations that use mercury as well as large scale mining operations that use cyanide can benefit from Clean Earth Technologiesfast-acting and non-toxic gold recovery reagent, and operators can mine cleanly with the assurance of a mining lixiviant that is both cyanide-free and mercury-free. With proper frameworks and the utilisation of a clean gold recovery reagent, the true, untapped potential of gold mining may finally be realised in the form of sustainable development.

 

Clean Mining is part of the Clean Earth Technologies group.

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[1] Blair Gifford, Andrew Kestler, and Sharmila Anand, “Building Local Legitimacy into Corporate Social Responsibility: Gold Mining Firms in Developing Nations,” Journal of World Business 45, no. 3 (2010): pp. 304-311, https://doi.org/10.1016/j.jwb.2009.09.007​.

[2] The World Bank, “Mozambique – Mining and Gas Technical Assistance Project”, The World Bank, March 2013: pp. 14-15, https://documents.worldbank.org/en/publication/documents-reports/documentdetail/246391468280494816/mozambique-mining -and-gas-technical-assistance-project

[3] Stefaan Dondeyne and Eduardo Ndunguru, “Artisanal Gold Mining and Rural Development Policies in Mozambique: Perspectives for the Future,” Futures 62 (2014): pp. 120-127,​ ​https://doi.org/10.1016/j.futures.2014.03.001​.

[4] Gavin Hilson, “Small-Scale Mining, Poverty and Economic Development in Sub-Saharan Africa: An Overview,” Resources Policy 34, no. 1-2 (0AD): pp. 1-5,​ ​https://doi.org/https://doi.org/10.1016/j.resourpol.2008.12.001​.

[5] For more on AGSM statistics, UN Environment, “Reducing Mercury Use in Artisanal and Small-Scale Gold Mining: A Practical Guide”, UNEP – UN Environment Programme, Accessed on October 29, 2020: p. 68, https://wedocs.unep.org/handle/20.500.11822/11524

[6] For more on mercury emission by sector, UN Environment, “Global Mercury Assessment 2018”, UNEP – UN Environment Programme, 2012: pp. 14-15,​ ​https://wedocs.unep.org/handle/20.500.11822/11524

[7] For more on the bias towards large-scale mining in Côte d’Ivoire, see Sauerwein, Titus. “Gold Mining and Development in Côte d’Ivoire: Trajectories, Opportunities and Oversights.” Land Use Policy 91 (2020): 104323. https://doi.org/10.1016/j.landusepol.2019.104323​.

[8] Emmanuel Ababio Ofosu-Mensah , “Gold Mining and the Socio-Economic Development of Obuasi in Adanse,” African Journal of History and Culture 3(4) (May 2011): pp. 54-64.

[9] Blair Gifford, Andrew Kestler, and Sharmila Anand, “Building Local Legitimacy into Corporate Social Responsibility: Gold Mining Firms in Developing Nations,” Journal of World Business 45, no. 3 (2010): pp. 304-311, https://doi.org/10.1016/j.jwb.2009.09.007​.

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