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August 11, 2022updated 26 Jul 2022 12:12pm

Opinion: South Africa must regulate artisanal mining carefully

South Africa must be careful about the way in which it regulates artisanal mining. Otherwise, thousands of miners could lose their livelihoods.

By Jason Mitchell

The small-scale and artisanal mining industry (ASM) employs up to 80 million people worldwide, and the sector has been part of the South African mining landscape for many years. It takes place across the country’s primary mineral commodities, including gold, coal, chrome, and diamonds.  
 
In South Africa,  as many as 30,000 men, women, and children – known as Zama Zamas – work in the industry. Often they work in and around an estimated 6,000 disused and ownerless mines across the country. However, many also work in active commercial mines. An estimated 10% of the country’s gold production comes from ASM, for example. Analysts say that more than R70bn ($4.3bn) a year of national revenue is being lost due to illegal mining in the country’s gold sector alone. 
 
Many artisanal miners are subsistence workers and a large number are illegal migrants from other African countries, including Zimbabwe, Malawi, and the Democratic Republic of the Congo. Unique to South Africa is the fact that illegal miners mostly target underground industrial shafts instead of open-pits – as is the case in most countries – and the activity often takes place within large-scale mines. It is a desperate way to scratch a living and many miners are vulnerable people. 
 
This unique phenomenon adds another layer of complexity to the industry, which is confounding South Africa’s law enforcement agencies and mining officials.  

A dangerous sector

Experts say that ASM is as much as 90 times more dangerous than larger, formal operations because of its unregulated status. Dozens of artisanal miners die every year. Local communities are directly impacted by illegal mining in terms of environmental degradation, health risks, and gang violence between rival groups of Zama Zamas. Some miners are killed in disputes over territory
 
ASM in South Africa is explicitly banned as current regulations outlaw any activities that take place without a permit, including both invasive and merely informal mining. The current regulatory framework treats small-scale miners in virtually the same way as large-scale miners.  

On 30 March 2022, South Africa’s Minister of Mineral Resources and Energy, Gwede Mantashe, published the Artisanal and Small Scale-Mining Policy 2022 for implementation. At the same time, he also published the Mine Community Resettlement Guidelines 2022.  
 
Under current rules, a mining permit – which is less onerous than a mining right – can be obtained but artisanal miners still struggle to meet its requirements. The new policy aims to create a formal ASM industry that can operate in a sustainable manner, contribute to the economy, and deter illegal mining. The Department of Mineral Resources would create a new system by introducing a new kind of permit. Further legislation would be required for it to operate.  

Distinguishing between artisanal and small-scale mining

Notably, the policy introduces formal definitions for ASM, setting out investment thresholds to distinguish between artisanal and small-scale miners, set at maximums of R1m ($59,000) and R10m ($590,000) respectively. 

“Artisanal mining” refers to traditional and customary mining operations using traditional or customary ways and means, including the use of mostly rudimentary mining methods, manual and rudimentary tools to access mineral ore – usually available on the surface – or at shallow depths. “Small-scale mining” means a prospecting or mining operation that does not employ specialised prospecting, mechanised mining technologies, chemicals including mercury and cyanide, or explosives. 
 
The ASM permits would be issued through on a “first come, first served” basis as well as an “invitation system”. Under the latter system, the government would be able to invite applications for ASM permits in designated areas. It is unclear whether this means that those areas would still be available for larger-scale mining and whether existing mining rights on those areas would be considered.  

The policy makes it clear that the permits must be reserved for South African citizens and proposes measures, including criminal ones, to deal with illegal migrants working in the industry. A dedicated special unit within the South African Police Service – whose suggested name is the Minerals and Precious Metals Theft Unit – is proposed. 
 
Under the new policy, large mining companies are not excluded from involvement in the activities of artisanal and small-scale operators. In fact, the policy proposes that large-scale operators and small-scale operators should co-exist in the form of tributing agreements. 

Regulated artisanal mining would improve human rights

ASM must be regulated but it is not certain that the new policy is the way to go about it. It needs formalising so that miners can access credit and some modicum of safety standards can be introduced. A more formalised industry would offer ASM miners better protection of their human rights and help stamp out gang-related activity.  
 
However, the new policy would create vast open-cast areas where artisanal miners could operate. It excludes previously mined areas so that artisanal miners are not liable for any previous environment damage. It assumes that a vast number of Zama Zamas would stop their illegal activities overnight, undertake formal training, adhere to health and safety rules, and pay taxes and royalties. That is not realistic.  
 
The South African Government must see artisanal and small-scale miners as stakeholders in the country’s mining industry. They need full consultation and must cooperate fully with any new rules if they are to work. 

It should also have an open dialogue with illegal migrants working in the sector, as many are highly vulnerable and impoverished people who could benefit from additional support. The South African Government should act humanely and try to find a role for them in the industry, as well, even if that means providing them with documentation.  
 
The government should also consider decentralising the administration of the ASM sector. This would make it easier for microfinancing to be provided and for off-taking arrangements to take place.   

The large-scale mining sector in Africa has concentrated on accessing large high-grade mineral deposits to ensure the viability of their operations. However, there is an abundance of lower-grade deposits deemed uneconomical for large companies but profitable for smaller enterprises. Identifying and exploiting such deposits is essential for the effective use of resources and opportunities in the mining industry. 

More resources and effort should be allocated to exploration and to mapping that tries to identify appropriate concessions for artisanal and small-scale mining enterprises. This approach should be adopted throughout Africa, not just in South Africa.  
 
In many cases, ASM is a highly dangerous activity. Many miners in South Africa do not choose this job but – in a country where youth unemployment is an astonishing 66.5% – they have no other option. If the South African Government really wants to end the issues associated with ASM, it must clamp down on corruption and work hard to create a more prosperous country where employment opportunities are more plentiful.

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