National Discussion on ASM Developments
Mega mining deals being announced frequently can be attention grabbing, but Artisanal and Small Scale (ASGM) is strongly in the picture. Developments in the gold sector, where ASM gold production has surpassed large scale gold producers offers a timely reminder to policy makers that ASM sector is an important part of the mining sector. Remarkably, the ASM is pivotal to the empowerment of resource rich communities. Largely, the sector contributes to the resilience of rural economies in the face of erratic agricultural yields caused by increased climate change risks, droughts and floods.
Against this background, the Zimbabwe Environmental Law Association (ZELA) together with the Zimbabwe Coalition on Debt and Development (ZIMCODD) organized a national caucus meeting focusing on key developments in the mining sector, including ASM sector. Held at Crowne Plaza hotel, Harare on Friday, 11 May 2018, the meeting was attended by 56 participants, comprising of Community Based Organisations (CBOs), Civil Society Organisations (CSOs), artisanal and small-scale miners, media and govern institutions.
This article zeroes in on the discussion on developments in the ASM sector which was led by the Zimbabwe Miners Federation (ZMF) CEO, Mr Wellington Takavarasha. According to Mr Takavarasha, the Zimbabwe Miners Federation (ZMF) represents 30 000 registered Artisanal and Small-Scale Miners (ASMers). However over 1,5 million artisanal and small-scale miners are operating illegally. Below are key discussion points;
ASM gold production has been growing since 2009. In 2017 ASM outpaced large scale producers through contributing 53,3% to the total national gold output of nearly 25 tonnes. This trend has continued in 2018, in the first quarter of the year, ASM sector produced 58,6% of the total gold output.
Criminalization of ASM has been on the decrease. In the new political dispensation ZMF has managed to have dialogue with the Office of the President and Cabinet (OPC) to stop the sporadic arrests of ASMers. A positive development, as evidenced by a surge in gold production by ASM. There is need for a shift of mind-set in Zimbabwe, so that ASM is taken as a poverty reduction strategy and a source of livelihood for the people. ASM should not be arrested for seeking to survive.
Notable, ZANU PF in its 2018 Manifesto promises to recognize artisanal mining. According the new Finance Act, ASM sector is reserved for indigenous players. Ominously, the Mines and Mineral Amendment Bill does not recognize artisanal mining. Other countries such as Tanzania have developed policies that formalizes ASM.
According to the latest Monetary Policy Statement (MPS), $74 million was disbursed to 255 small scale miners in 2017. This year, $150 million has been earmarked to support gold production in the ASM sector. Key questions that need to be interrogated is whether the loan facility is benefitting the ASMers who are in need. Secondly, interrogation is needed to understand whether women miners have benefitted from the loan facility.
A cursory glance shows that the loan facility could have benefitted over 1000 syndicates given that on average, a mining venture requires about $20 000 to $30,000 as jumpstart capital.There is need to promote transparency and accountability in the disbursement of this loan to ensure that it is not abused and reaches the intended beneficiaries.
Gender discrimination has been an inhibiting factor for some women miners. For example, in Inyanga, a traditional leader refused the Minister Muchinguri permission to set up a milling center for women.
There are many social challenges associated with ASM operations which include: violence through use of machetes, prostitution, early child marriages, degradation of the environment, drug and alcohol abuse.
Youth are struggling to get funding for their operations, because of their unwillingness to organize themselves into syndicates. Syndicates have a better chance of getting capital.
Several ASMers have been duped by suppliers who were paid under FPR’s gold mobilization fund because the suppliers are failing to deliver the paid equipment. Therefore, it is important for ASMers to conduct a due diligence to ensure that they work with genuine suppliers. The FPR does not have the onus to conduct a due diligence on suppliers of equipment and machinery to ASM.
Women miners raised concern that they were lagging in getting access to the loan facility set up by the FPR. In response, Mr Takavarasha highlighted that there was serious competition for the loan and all applicants needed to be patient, as all applications were considered on merit.
Part of the gold from ASM is sold on the black market because banks and FPR take a long time to pay miners their money. The black market pays 100 % in forex for the gold sold but this has many risks. Firstly, machines used for weighing the gold can be wrongly calibrated to under weigh the gold. Secondly ASMers run the risk of being paid fake USD.
There is need to enact the ‘use it or lose it policy’ in order for big mines to release ground for the benefit of new entrants in mining and for ASM to get access to rich gold deposits. Currently most of the rich concessions are owned by large mining companies.
To address violence among the ASMers, such as the use of machetes, ZMF has sought the assistance of the police and army in educating and raising awareness on the dangers associated with such practices. There are still sporadic cases of the use of machetes in places such as Geiger in Kwekwe.
Under the Zimbabwe is Open for Business Mantra, it is important for ASM to be taught how to negotiate and enter into viable contracts. Otherwise they run the risk of losing their claims from unscrupulous investors.
There is need to balance the 10% export incentive offered to ASM gold producers with the interest of government to generate revenue and sustainability concerns. The 10% export incentive should be accessed on condition that miners how proof that they are rehabilitating the environment.
Some of the policies hindering growth of ASM include burdensome provisions of the Environmental Management Act (EMA) Act. The thrust is to have EIA provisions simplified to something of a check-list than to include technical terms in a language not easily understood by ASMers.