OPINION | Gold industry, invest in small scale mining

August 02, 2019
| Solidaridad
ASM produces 20% of the world's gold production.
Between 20 and 30 million people work in ASM gold mines worldwide.
OPINION | Gold industry, invest in small scale mining

Por: Carla Neefs, Corporate Partnerships Gold at Solidaridad Europe.

Last week, the Dutch TV channel RTL4 broadcasted an item about the dangerous working conditions in artisanal and small scale (ASM) gold mining. The Ghanaian small scale gold miner Yaw Ngoha literally worked himself to death due to mercury poisoning acquired at the mine site. His wages had enabled him to buy a big house with satellite TV and a veranda... but the conditions in which he worked meant that he had to pay for it with his life. 

Stories like this don’t stand alone. ASM mining goes hand in hand with dangerous and unfair working conditions, pollution of the environment, and human rights abuses. The international gold industry is afraid of reputational damage and sometimes even bans sourcing from ASM mines all together. Problem solved, isn’t it? Not at all: risk avoiding behaviour is part of the problem! The Organisation for Economic Co-operation and Development (OECD) deplores these kinds of decisions in its Alignment Assessment 2018. So Solidaridad does as well. 

100 million livelihoods in ASM gold mines

First of all, 20 to 30 million people work in ASM gold mines worldwide and as many as 5 times that number of people depend on these mines for their livelihoods, such as the local populations in the surrounding communities. A ban on sourcing from these mines simply means putting 100 million futures at risk. Besides, ASM generates 20% of the 3,200 tonnes of newly mined gold that is refined worldwide every year. It is simply not economically possible to disregard 20% of the world’s gold production. If responsible refineries refuse artisanal gold, it will disappear into obscure gold supply chains, which are certainly not responsible. 

Large-scale mining no guarantee for responsible gold

Secondly, the large-scale industrial mines aren’t any better. There are cases of water pollution, violence towards mine workers, money laundering and corruption. So sourcing gold from the big mines is no guarantee for gold buyers that they will have access to a secure future supply of verified, responsible gold. Gold buyers will remain exposed to reputational risk as human rights abuses and environmental pollution continue. 

It’s a question of supply and demand

The market for responsible ASM gold will not be able to grow if the gold industry continues to avoid taking risks. Recently Max Havelaar even stopped supplying fairtrade gold from ASM mines to the Dutch market. This is a big setback, because it was the only supplier of fairtrade ASM gold to the Netherlands. The supply of responsible ASM gold can only grow if there is a market for it. The current market conditions, however, mean that ASM mines are unable to make the necessary investments in responsible improvements. It’s a vicious cycle we need to break. 

Taking the responsibility, making a change

So to all the gold buyers: take your responsibility, invest in small scale mining and make a truly inclusive, responsible and transparent gold supply chain possible! At Solidaridad, we have just signed a contract with a gold buyer that does take its responsibility: the Dutch precious metal company Aunexum is now supporting our Golden Line programme in Ghana and Tanzania. In this programme, we work together with partners on economically empowering women in ASM gold mining and training mine workers in safe mining practices. Aunexum will help us with the development of ASM technology for mercury free production and local smelting facilities. They have also committed to support the selling of the Golden Line gold when it is mercury free produced. 

We need these kinds of frontrunners to make a change. Companies which are not only interested in saving their own skins, but also those of millions of others. In this way we can ensure that small scale miners will have a better livelihood and a chance for a bright future.

Link to original opinion piece


In PIM we look for the sum of efforts permanently. If you participate in the value chain of Artisanal and Small Scale Mining as a producer, supplier or final buyer, you can contact pim@solidaridadnetwork.org for more information.