MUTARE– Stakeholders in the mining sector have urged government to revive its legacy efforts of formalizing artisanal mining to curb crime, black market trading and Illicit financial flows IFFs.
Speaking during a virtual discussion organized by the Zimbabwe Allied Diamond Workers Union (ZIDAWU) Proud Nyakunu, ZIDAWU legal officer, called for revival of formalization efforts and support for the policy to formalize artisanal and small-scale miners.
Nyakunu said, then, government used a combination of district and nationally administered licensing and capacity building measures to formalize until political will dwindled, with it so were financial resources.
She said despite the failure of “decentralization” efforts in the 1990s and early 2000s, hampered by insufficient resources and power transfers, government should revive the model seen as a source of optimism.
“In 1991, the government of Zimbabwe enacted statutory instrument 275 of 1991, the Mining (Alluvial Gold) (Public Streams) Regulations in order to recognize the artisanal and small scale mining sector thereby incorporating the sector into the national developmental plans.
“The regulatory instrument allowed local authorities particularly rural district councils to allocate mining blocks to organized ASM in consultation with the Mining Commissioner.
“These initiatives combined the goals of promoting safer environmental management and developing policies for ASM legalization, focusing on two types of gold mining alluvial gold panning in riverbeds and small-scale primary ore extraction on land,” said Nyakunu.
Nyakunu said these arrangements were discarded in the post-2000 hyper-inflationary period when government agencies centralized authority over the mining sector and implemented heavy-handed crackdowns targeting ASM.
The statutory instrument was repealed as government responded to increases case of illegal trade in gold in 2014, alluvial mining was effectively banned through Environmental Management Regulations (EMR) (2014).
At the time through Reserve Bank of Zimbabwe, the state argued, that artisanal mining caused chaos, environmental degradation, smuggling of minerals and illicit financial flows.
To address this it introduced (2014) the Artisanal Mining Permits (AMPs), issued at gold service centres, FPR sites, and licensed millers’ offices, aimed at easing gold trade with Fidelity Printers and Refineries.
“The greatest reason behind reluctance on part of the government to formalize Artisanal mining is that most political heavyweights are allegedly involved in the artisanal mining, for example, the Redwing mine in Penhalonga. Most of people carrying mining activities in the area are alleged to be backed by senior government officials.
“It is clear that artisanal mining causes leakages of minerals, illicit financial flows and there is need for formalization to curb this, however, government is using this and its previous attempt to defend reluctance on formalization,” said Nyakunu.
Shamiso Mutisi Zimbabwe Environmental Law Association (ZELA) deputy director concurs that there are tangible benefits which can accrue both to the state and the generality of Zimbabweans through formalization.
Mutisi said formalization can effectively cut off illicit gold trade, which in itself is mainly influenced by corruption instigated by the elite capture of natural resources, who benefit amidst this chaos,
“The public can benefit from ASM in different ways including employment, incomes for households involved, contribution to national fiscus and even the local economy at ASM mining sites miners also buy other goods and services for their operations and this benefits other businesses and the public
“However the problem is that in a situation where minerals are sold outside the formal market or on the black market the fiscus then receives less income from the ASM sector.
“The elite can capture the mining and trade of minerals of existing policies and laws are not adequate to promote transparency and accountability and in curbing corruption. Lack of enforcement of laws and monitoring may also lead to elite capture of the benefits.
“So fighting corruption remains key,” said Mutisi.
Mutisi said it was an imperative that government formalizes ASM as the current context in the gold sector favored this sector, which is more agile to respond to the prevailing political environment, than large scale miners.
He said formalization will further stimulate production in the ASM sector by setting predictable and consistent gold trading policies and practices.
“Given the number of ASM miners in Zimbabwe and the increasing number of people going into ASM, the sector can even surpass the current levels of gold production and contribution to the economy. The numbers can also increase if leakages of gold for example into the black is curbed through adoption and implementation of predictable and consistent gold trading policies
“The large scale miners are affected by the current economic and political environment and most of the companies have closed or are on care and maintenance and this makes it difficult for them to produce.
“The ASM sector is more agile and adaptive to the prevailing difficult political and economic environment than large scale miners,” said Mutisi.
As part of ongoing work in the sector, ZELA says legal and policy formalization will bring legitimacy, ensure compliance to laws by artisanal miners, and promote better working practices as well reducing negative environmental impacts of mining activities.
Nobuhle Mabhikwa of ZELA says lack of legal recognition of artisanal miners as formal players regardless is in spite of significant contribution to the national fiscus.
Formalization will prevent and help to better manage conflict associated with encroachment of miners and operations onto large-scale mining concessions, said Mabhikwa.
She said while it has been a viable livelihood option for many rural populations, the rampant criminality that is prevalent results from the unregulated operating environment in the sector
Mabhikwa said responsible development of gold resources both through large-scale mining (LSM) and artisanal mining, especially when coupled with sound governance, has potential to deliver broad social and economic benefits to individuals, communities and countries.
“It has been evident that, for the past 3 years, the artisanal (and small-scale) miners have been producing and more gold to the FPR, (increased revenue inflow to the national fiscus), it becomes imperative that the sector should be formalized.
“It is increasingly becoming evident that artisanal and small-scale mining is. Government should respond by formalizing, just in the same rationale it is asking informal traders to come forward and register in order to start operating under the eased lockdown.
“Therefore, it becomes imperative for host governments to consider how best to ensure the optimum model to develop frameworks, to support sustained social and economic development for the local community and nation at large,” said Mabhikwa.
