The Sunday News
Butler Tambo
IN this series I will look at gold mining and its contribution to the Zimbabwean economy with a bias towards artisanal miners or amakorokoza as they are better known in the country. I envisage looking at how these miners can meaningfully contribute to the fiscus and in later series look at a metal value chain as a panacea to mining revenue leakages in Zimbabwe.
Contextualising Artisanal Small-scale mining (ASM) in Zimbabwe.
There is no single agreed definition of artisanal small-scale mining although common references associate the practice with low levels of production, poorly skilled labour, poor technology, small claims, subsistence and illegality. ASM blurs the boundary between informal and registered small-scale miners, both of which are generally included in the definition. Moreover, although there is a provision in the Mines and Minerals Act for registration of small claims of less than 20 000 square metres, there is no policy specifically to regulate ASM more broadly. In 2002, the Government used output criteria to define “small ASM” gold producers, limiting them to those producing “less than 15 kilogrammes of gold/year.” In practice, one can distinguish between two broad types of ASM miners, namely:
1) registered miners, i.e. those who have registered small claims and gold processing mills with the Ministry of Mines and Mining Development; these are usually individually or family-owned, although they may also be company owned; 2) informal, unregistered, or illegal producers, known locally as amakorokoza. From the colonial period to the 1980s, the Government often referred to the size of the labour force (less than 50 employees) in distinguishing small-scale miners from medium to large-scale operations. Chikorokoza involves both full-time, often nomadic artisanal miners targeting auriferous reefs, abandoned mines, old workings and dumps, or rural subsistence farmers engaging in artisanal mining between farming activities. In practice there is a strong intersection between small registered works and chikorokoza, with the former usually purchasing and processing gold from the latter.
Brief historical development of ASM in Zimbabwe
Pre-colonial ASM
Gold mining and trade in Zimbabwe predates the advent of colonial rule in 1890. Pre-colonial mining consisted of small works in gold, copper and iron, what would qualify in the modern era as ASM. Evidence suggests that gold production and trade was vital for the pre-colonial Zimbabwe polities of Great Zimbabwe, Khami and Mutapa. Colonial policies that forced Africans into wage labour saw the death of this craft. Although colonial Zimbabwe had a vibrant small-scale gold-mining sector, this was restricted to whites. Only minimal riverbank panning by Africans remained as a continuation of pre-colonial mining.
Post-colonial ASM in Zimbabwe
With the end of colonial rule in 1980, the sector opened up somewhat with several new small-scale mines being established with support from the Ministry of Mines and the State-owned Zimbabwe Mining Development Corporation (ZMDC) which was formed in 1982 to invest on behalf of the State, oversee the development of the mining sector and support mining co-operatives. Registered claims increased from 1 000 to 10,000 between 1983 and 1990.
ASM in the 1990s
Yet it was not until the early 1990s that Government started actively to encourage artisanal mining. The IMF and World Bank-sponsored Economic Structural Adjustment Programme promoted economic liberalisation and encouraged ASM and other self-employment activities. Ironically ASM would later be viewed as offering refuge to victims of ESAP’s tragic economic effects. The new Mining Regulations of 1990 allowed Rural District Councils to licence artisanal miners and regulate environmental impacts. The Ministry of Mines and Mining Development, with assistance from the University of Zimbabwe’s Engineering department, provided technical training for artisanal miners.
Other scholars have argued that in the 1990s, ESAP prioritised mining but focused on large mining companies. Small-scale mining associations have long criticised the fact that many of the country’s mineral titles remain held by large companies and not small-scale miners. Miners associations have protested that 95 percent of the Great Dyke is covered by mining licences held by large companies including Zimasco, ZimAlloys, and Zimplats, reflecting the legacy of colonialism.
In 1993, Zimbabwe hosted a world summit on ASM, which produced the Harare Guidelines on Small/Medium-Scale Mining. The declaration provided commitments to poverty-reduction-oriented development assistance for ASM in developing countries. From 1996, the Reserve Bank f Zimbabwe’s gold-buying agency, Fidelity Printers and Refiners started to accept gold in small amounts (as low as 50 grams). Small miners were offered relatively high prices for gold deliveries.
Post 2000 ASM
Zimbabwe’s economy experienced challenges around 2000, particularly when inflation levels ascended dramatically in 2006. Grappling with the economic crisis in 2006 and 2007, the Government insisted (in accordance with the Gold Trade Act Chapter 21:03) that gold miners sell their gold to the RBZ at a fraction of the international gold price, sometimes even as little as one-thirtieth of the true international price when calculated at parallel market rates.
Furthermore, RDCs were disempowered and riverbed panning was made completely illegal in 2006, when the central Government repealed the law (Statutory Instrument 275 of 1991) that allowed RDCs to issue permits for gold panning. While the move to criminalise riverbed panning occurred officially in June 2006, tensions intensified later that year. In November 2006, the Government launched a nationwide crackdown operation against gold panners, miners, and traders called Operation Chikorokoza Chapera (‘‘No More Illegal Mining’’) — which escalated during the week before Christmas. By early 2007, the crackdown was in full swing and police units were traveling to different mining sites across the country, arresting hundreds of miners at a time. Amid these problems, Zimbabwe’s official gold production declined from 11 tonnes in 2006 to just above seven tonnes in 2007, the lowest level of output in more than 100 years. This decline itself is indicative that the Operation Chikorokoza Chapera was a drastic failure — if the policy intent was to increase official gold collections by the Government.
ASM contribution to economy and accountability issues in Zimbabwe
The ASM provides significant but generally poorly paid employment in difficult working conditions for the most marginalised populations in many developing countries, Zimbabwe included. Gold deliveries to Fidelity Printers and Refiners (FPR) in Zimbabwe which hit 10 tonnes during the first half of 2017 grew by 3.9 percent compared to the same period last year. The Reserve Bank of Zimbabwe expects gold deliveries to FPR to reach the targeted 25 tonnes by year-end. Artisanal miners continue to grow in their contribution to gold production accounting for about 45 percent of total deliveries in 2016 and 2017 (RBZ, 2017). Regulation of ASM in Zimbabwe tends to be half-hearted, inconsistent and election driven. In some instances, ministers have expressed unease over the uncontrolled nature of small-scale mining. At the same time, Government has been quick to celebrate the sector’s contribution to the national economy and empowerment of blacks.
Despite this massive contribution to the fiscus by artisanal miners, the government has focused its policy-making initiatives on improving the governance of medium and small-scale mining and has mostly neglected artisanal miners, reducing them to illegal labourers associated with criminality and a harmful impact on the environment.
Zimbabwe also has a large number of unregistered small-scale miners (400 000 unregistered small-scale miners in gold production) which provides a fertile ground for capital flight in the mining sector, given that unregistered miners may not be able to sell their minerals through formal markets. It is also the case that most output from ASM is unaccounted for; rendering official output figures a massive underestimation. In 2007 the then Governor of the RBZ, Dr Gideon Gono estimated that more than 15 tonnes of gold (worth over US$400 million then), diamonds worth over US$800 million and other minerals worth about US$200 million were smuggled out of the country annually between 2002-2007. With such leakages and the potential that ASM has one will in the next instalment try and see how the sector can be made more accountable in order for it to contribute more meaningfully to the fiscus and not for it to be associated with violence and immorality alone.
-Butler Tambo is a Policy Analyst who works for the Centre for Public Engagement and can be contacted on [email protected]
