TECHNICAL FILE
By Grain Wyson Phillip Malunga FIMMM Mining and Environmental Management Expert
The Nature of Artisanal and Small Scale Mining in Malawi
Abstract
Artisanal and Small Scale Mining (ASM) offers an alternative source of income to majority of poor people. It complements income from subsistence farming. Over 40,000 people benefit from this business including women, children and ex-miners. The sector is mostly informal and characterized by illegal mining, environmental degradation, use of traditional tools and often disregards occupational health and safety. There is no income saving as their money is from hand to mouth. There is no tomorrow but today.
Introduction
Artisanal and small scale mining (ASM) is a method of exploitation of mineral resources using labour intensive technology usually in an informal setting and without social and environmental consideration. This activity provides employment for over 40,000 people in Malawi with most of them operating without a license that could otherwise offer them legal protection and offer them formal source of capital and market for their production.
Common minerals in this category include stone aggregate, bricks, sand, limestone, gemstones and alluvial gold. ASM in industrial minerals is common in urban areas and their vicinity. Gemstone mining is common in Mzimba – Chitipa belt and Ntcheu- Nsanje belt. Alluvial gold mining is popular in Lisungwe River (Neno) and Unga River in Mangochi.
Characteristics of ASM
Organisation
Lack of proper umbrella organization for ASM has led to difficulties in supporting them to legalise their mines and help them with book keeping and cost analysis. ASM can play a crucial role in poverty alleviation and rural development if properly organised. Local councils can raise finance through permits and royalties.
Human Resources
ASM is commonly done by unskilled labour dominated by women, school going children and mostly men who might have been dismissed or retired from gainfull employment in medium to large scale mines in the Southern Africa.
Those that work in the sector have a gambling mentality and often practice subistence economy and give bad social image of mining through prostitution and disregard for culture.
Environmental Concerns
ASM promotes environmental degradation and has no concern for occupation health and safety. Influx of workers and traders creates conflict with surrounding communities and sometimes fuelling substance abuse, alcoholism and communicable and sanitation related diseases.
Those in alluvial mining promotes siltation and destruction of breeding habitats for aquatic life. Unga River in Mangochi is facing similar threats arising from alluvial gold mining.
Financial Issues
Due to poverty driven decisions, uneconomic investment decisions are made. A large number engage in exploiting limited resources. There is low recovery and productivity that affect bulk marketing and this encourages intermediate buyers offering low prices.
Another challenge is limited access to investors and equity capital due to illegality of the sector and the difficulties that emerge in trying to legalise the mines.
Technology
ASM absorbs low level of technology and practice poor geo-prospecting. Its operations use labour intensive technology which offers low productivity.
Proposed Government intervention
ASM needs government intervention to promote sustainable mining operations. There is need to establish a legal and regulatory environment that supports local economic development through assistance in form of value addition and access to established markets. Linkages with mineral based industries will be an incentive to promote ASM grow into organised medium scale mining industry.
Restructuring of local councils to include District Mining Officers will help offer technical assistance to ASM including identification of proper mining sites and assist with environmental management to prevent child labour, land and forestry degradation. Occupational health and safety will also be improved. This will reduce incidences of silicosis and TB.
Formalisation or issuance of mineral permits by local councils will enable them have more revenue through ground rents and royalties while central government will collect revenue in form of export permits, royalties and taxes.
Conclusion
Formalisation of ASM is a means of promoting sustainable development in an environment where poverty is rampant and people are forced to supplement income from subsistence farming. Mining Permits will help improve collateral for finance in order to obtain capital for technology improvement. Simple tools will be replaced by mechanised hand tools. Access to markets will be formalised and will reduce intermediate buyers who offer low prices and do not pay tax.
Legalisation of ASM can promote access to investors and attract equity capital. Economic investment decisions and gambler mentality will be reduced. Appropriate mineral deposits will be extracted and coordination among miners through miners associations will be improved.
References
1. Drechsler, B. 2001. Small Scale Mining and Sustainable Development within the SADC Region. MMSD, London
2. Labonne, B and J. Gilaman. 1999. Towards Building Sustainable Livelihoods in the Artisanal Mining Communities. Conference Paper.
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This piece was initially published in Malawi’s Mining & Trade Review Issue Number 53 (September 2017).
The full edition is available for download here. This monthly publication is edited by Marcel Chimwala.
