Leaders worldwide are responding to COVID-19 in a variety of ways. As we have already highlighted, the pandemic has had disproportionate impacts on minorities and underserved communities, including migrant workers and other populations that were already vulnerable to Modern Slavery. In this second installment of our COVID-19 series, we explore how the pandemic is affecting the 42 million people working in artisanal small-scale mining (ASM) communities worldwide.
The number of ASM operators has grown substantially worldwide. Although ASM sources meet 20% of our gold supply, they represent 90% of employment in the gold sector and are particularly concentrated in poor and middle-income countries. (For a full analysis of ASM issues and opportunities, we recommend Solidaridad Network’s Golden Myths webinars and Levin Sources).
The World Jewelry Confederation (CIBJO) organized a recent webinar on the impact of COVID on mining communities. In her introduction, Estelle Levin-Nally, founder of Levin Sources, reminded us that ASM is not homogenous. It is therefore difficult to come up with blanket frameworks or statements that will apply well to all contexts. As tends to be the case with complex, systemic issues, there is no silver bullet and no-one size fits all solutions. That being said, the challenges and opportunities we describe here are representative of some of the broader issues that ASM faces today.
- COVID-19 is a global crisis. Global supply chains also mean global impacts. In our interconnected, globalized world, trade between countries and regions has meant that what happens in one country affects all players upstream and downstream in the supply chain. A shift in consumer preferences or behavior in the Global North has widespread impacts in the Global South. Under COVID, the economic impacts of extreme changes in demand of goods will be felt around the globe. Communities in source countries for gold and other raw materials are being hit with joblessness, food insecurity, and an increase in poverty rates even before the actual virus spreads locally. The economic impact has, in this case, traveled faster than the disease.
- The capacity to respond to the crisis is differential. For example, Burkina Faso has a total of 11 ventilators in the whole country, Papua New Guinea has 14, and 10 countries in Africa have none.
3. Precarious economic conditions in ASM communities will be exacerbated. Rural, remote areas with high concentrations of ASM are often in conflict areas and are highly dependent on day to day incomes. On top of this, mining incomes are highly variable and there is no easy fall back option to rely on. Thus, mine closures will severely impact the livelihoods of those that depended on it. Many people have no other sources of income and may choose to go back to mine sites, even if they are meant to be closed for social distancing. We are already seeing cases of miners going to work even if it is not technically allowed. This also means higher mobility to go into the mine site and close contact with one another. Additionally, joblessness in nearby remote urban centers may drive more people to ASM and increase tensions around already scarce resources. Even if they are able to extract, there is no market to sell the gold. In terms of hygiene and disease prevention, many of these communities lack safe access to a clean water supply and other preventive measures. There are also occupational risk factors due to the exposure to silica dust which can lead to silicosis and organ damage that can result from the use of mercury. Women will be disproportionately affected by these changes; going t the mine site at night may place them at risk for abuse and as has already been noted elsewhere, stay at home orders have led to more cases of domestic violence.
4. The complete shutdown of exports and resource flows have opened a window of opportunity for illegal capture. As a recent call to action stated, “Where formal channels have collapsed, illicit actors are repositioning themselves to claim an even larger market share, which can increase criminality and insecurity, exaggerate local tensions, create community division, and increase risks to companies that source from the region”. The fact that we are now in a buyer’s market creates more risks of exploitation of the workers and a liquidity crunch at the mine site. Prices of FIELD gold are dropping even if prices in world market are increasing
5. Funding from international and local sources may be reoriented to COVID response and can decrease the amount of funds available for ongoing work in ASM communities.
We know that there is no playbook for COVID and no script to follow. Nonetheless, we do believe that there are best practices that we can rely on and use in times of crisis. The overarching goal is to rebuild better: the breakdown of supply chains presents an opportunity to replace our current system with one that supports mining communities. To do so, a recent publication by Adam Rolfe and Angela Jorns underlines that COVID responses must be guided by available data on the needs of the communities and adapted to local contexts. Additionally, these responses must not sideline structural improvements that were already on the way towards formalization.
As governments, managers upstream and downstream, funders, workers, and other stakeholders collaborate to respond, we recommend the following:
- Immediate response: Use the logistical networks in place for gold to deliver health assistance and food. This is in line with the OECD’s recommendation to activate humanitarian and emergency response networks.
- Continue sourcing from ASM. The wrong response is to say that Human Rights risks are higher so the company won’t source from ASM. We advocate for precisely the opposite approach: we need to double down to mitigate risks. It is the the most vulnerable that need the most due diligence. Including ASM in global supply chains is a key part in building back better. This can be done by establishing partnerships that bring together stakeholders to manage risks.
- Prioritize establishing or reopening a formal trading market to diminish strengthening of informal channels/smuggling.
- Commit to supporting communities by allocating funds and recognize that bilateral loans and multilateral aid still need to play a role in formalization.
- Act responsibly — ensure operations abide to COVID guidelines and manage impacts as much as possible. A recent call to action by 73 Civil Society Organizations recommends evaluating if mine sites should be allowed to operate as an essential service on a case by case basis and developing Standard Operating Procedures for ASM.
- Disseminate health information in local languages and use lessons learned from handling the ebola crisis: communities need to trust the information and know they can seek out medical care without fear of stigmatization. Establish mobile clinics for testing and screening.
ASGM is a way to transfer wealth to poor, remote communities. Buy artisanal gold.
Planet Gold COVID dashboard with country-level updates
Steps to close the data gap in ASM
For Investors: Principles for Responsible Investment in Extractives