With an estimated 40 million people engaged in artisanal and small-scale mining (ASM) globally, the much maligned and somewhat hidden industry has a significant impact on the global mining economy.

Accountable for more than 80 per cent of the world’s sapphire and 20 per cent of global gold supply and diamond supply, these small operations represent a large portion of the minerals marketplace and the vast majority of its workforce, according to The World Bank.

In 1993 it was estimated 6 million people were engaged directly in ASM. 

ASM is practised in about 80 countries, primarily in the Southern Hemisphere — Sub-Saharan Africa, Asia, Oceania and Central and South America. 

Thirty per cent of ASM workers are women, according to small-scale mining database Delve, with most workers (16 million) residing in the South Asian region. 

However, sparse data in the sector is disguising ASM’s true impact, according to Delve’s 2019 State of the Artisanal and Small-Scale Mining Sector report, compiled with support from World Bank Group and not-for-profit Pact. 

Through its Mines to Markets program, Pact has helped 82,000 ASM miners to improve access to markets, incomes and working conditions. 

Pact Director of Mining Cristina Villegas said ASM was sensitive to mineral prices and local economics, with the prevalence of ASM correlating with a country’s economic development. 

“Currently, with the gold price inching up again, this will certainly drive more people into ASM as it did the last time this happened in the 2008-2012 period,” she said. 

International Institute for Environment and Development Lead Researcher on Artisanal Mining Gabriela Flores Zavala said while 40 million were believed to be directly involved with ASM, more were involved through wider local communities. 

“The fact is you get people setting up micro-businesses to service ASM operations, from little restaurants to shops,” she said. 

“In ASM it is a part of the fabric of the community, it comes from the community.” 

Ms Villegas said there was a difference between artisanal and small-scale mines. 

“Truly artisanal sites involve people using shovels, picks and human strength to dig minerals out of the ground, often working on their own or in groups of three to 10, sometimes more,” she said. 

“Small-scale mines are more advanced, usually mechanised, have a financier and have higher production due to the investment. These are often work sites of around 10, 50 or even hundreds. 

“A series of local brokers tend to play important roles in moving the materials from the mine to regional towns, ports or other places of export.” 

ASM is generally seen as a route out of poverty, according to Ms Villegas. 

“You can meet all of humanity here and some of the hardest working people you could imagine,” she said. 

“I started my career in West Africa, where I met ex-combatants from West Africa’s civil wars, farmers who were farming in the wet season and mining in the dry season, women who were mining to support their families and even local college students who were mining for tuition.” 

Ms Villegas said in one Liberian gold camp the miners were typically earning US$17 ($24.78) a day in the wet season, which is a difficult time to mine. This is compared to the average Liberian making US$2 ($2.92) a day, she said. 

“It is little surprise more and more rural people have turned to mining,” Ms Villegas said. “It is simple economics.” 

While the impact of ASM on local economies and employment is undeniable, the industry has a significant negative impact on the environment. 

A 2018 report entitled Global Trends in Artisanal and Small-Scale Mining, highlighted the environmental downsides of the industry. 

“Although each ASM site has specific characteristics, some common factors can accentuate the general environment, health and safety impacts of ASM activities,” the report stated. 

“These include lack of mechanisation, use of rudimentary techniques, low levels of occupational health and safety practices, lack of a skilled workforce, lack of social security and lack of awareness.” 

Ms Villegas said environmental custodianship was a serious challenge for the sector. 

“Mercury is still used in ASM gold mining,” she said.“We need new innovations here, new financing vehicles and new partnerships and ventures to help miners transition from this hazardous old technology to greener, more efficient ones. 

“This is where the other part of the mining sector – large-scale mines (LSM) – can play a huge role in terms of outreach, expertise, boots on the ground and bringing in extra technical and social partners.” 

In many countries, 70 to 80 per cent of small-scale miners are informal, according to the Global Trends in Artisanal and Small-Scale Mining report. 

Ms Zavala said formalisation had a big part to play in a more sustainable ASM industry. 

“Formalisation is essential, but it is one ingredient in the mix,” she said. 

“What is essential for formalisation to happen is to have policy frameworks that understand and support ASM. 

“In many countries there is no differentiation between policy expectations and regulations from large to small-scale mining.” 

Ms Zavala said formalisation needed to come from the ground up. 

“The discussions we have here in London will be very different to what happens on the ground,” she said. 

“Some people say large companies don’t really care, but I don’t think that is right. On the local level they do care and want to be a part of the solution, but they have to go through corporate procedures and priorities.” 

A study from 2019 titled Small in Size, but Big in Impact: Socio-Environmental Reforms for Sustainable Artisanal and Small-Scale Mining highlighted how formalisation could help progress towards a more sustainable industry. 

“Sustainable reforms would improve environmental performance, sustainability and the socioeconomic benefits of the sector,” the report stated. 

“A well-formalised and regulated ASM sector could reduce the environmental impacts associated with the activities and serve as a useful poverty alleviation alternative in many poor rural communities.” 

This process has begun in the Philippines, with the government introducing new laws to exempt small-scale gold miners from excise and income taxes when selling to the country’s central bank. 

“For governments and those who are working with them, the focus should be on business development and careful formalisation efforts,” Ms Villegas said. 

“This needs to start with data. Definitions should follow and then policy should be made from that country’s development ambitions. 

“A couple of industry observers who I follow closely often say countries that delimit and view ASM as only a subsistence activity will get ‘exactly what they asked for – highly migrant, short-term subsistence mining with horrendous safety and environmental problems’. 

“But if you pause and create the right infrastructure and incentives, countries can expect the sector to develop towards organised associations, cooperatives and companies that slowly improve their technical and environmental performance.” 

Another example of formalisation can be seen in Tanzania, according to Ms Villegas, where the government allows individuals to group together to be on one license that costs the same as an individual one. 

“In that way they are making the law inclusive, and legality possible for millions of rural miners who may want the benefits of formality for investment or other purposes,” she said. 

Ms Villegas said leaving the ASM industry in policy limbo could lead to disastrous effects. 

In June, a Glencore subsidiary Kamoto Copper Company (KCC) estimated 2000 illegal miners trespassed on its minesite each day in the Democratic Republic of Congo (DRC). 

A landslide in the same month killed 43 artisanal miners. 

The Congolese army responded, starting a controversial military operation to clear tens of thousands of miners from the KCC and similar minesites. 

“For some reason, despite the myriad options available, the military is sent to protect the larger mines. It is enraging,” Ms Villegas said. 

“I say that because I know of no example where this has actually ‘worked’. 

“It is extremely short-sighted thinking, it is expensive, it almost always results in jaw-dropping human rights violations, often results in elements of the military becoming involved in difficult ways, typically escalates tensions and it limits the possibilities of what could happen next. 

“The question I always ask when I hear about this is, ‘what is your plan for when the military leaves, and who is paying the bill?’.” 

In August of this year the Toronto-based gold company Iamgold announced it was forced to temporarily suspend operations in its Rosebel gold mine in Suriname after a clash between artisanal miners and police left one artisanal miner dead. 

As LSM companies exploit more marginal resources, the probability of interaction with ASM communities increases, according to the Global Trends in Artisanal and Small-Scale Mining report. 

“The instances where ASM and LSM activities meet have usually been underscored by tension and conflict over land, access and control of mineral deposits, as well as the right to mine,” the report stated. 

“In many countries the mineral governance framework favours foreign direct investment in the LSM sector over local ASM, leading to significant power imbalances and clashes over claims.” 

Recently discussions about the sector have shifted, according to Ms Villegas. 

“In the past 10 years the conversation has completely shifted from ignoring or marginalising these local miners to a conversation about jobs, local impact, human rights and business engagement,” she said. 

“Thanks to more careful research, it is now undisputed that ASM is an important component to most economies where it exists. In Africa, it’s the second most important occupation after farming in terms of rural livelihoods. 

“We found that in Rwanda, for example, the ASM sector produces almost 20 per cent of the country’s exports. 

“In Kenya, the ASM gold sector produces US$225million ($335 million) per year. 

“The numbers are staggering. And those numbers illustrate my bigger point: can you imagine what ASM could do for rural economies if we all started acknowledging it and bringing it into the formal economy?”