Zambia moves to regulate gold mining by engaging the Artisanal and small-scale miners

Zambia moves to regulate gold mining by engaging the Artisanal and small-scale miners

Artisanal and small-scale miners (ASM) in Zambia have been rushing to extract newly discovered deposits of gold and manganese across the country. Ideally, these operations are supposed to purchase licenses, provide environmental plans and pay fees. However, many don’t, resulting in some of the commodities being smuggled out of the country. The operations are consequently characterized by poor health and safety standards,

In a bid to prevent the smuggling as well as regulate gold mining, Zambia’s mining investment arm ZCCM-IH is working to increase engagement with the ASM sector. This is by buying gold from informal miners. Further, ZCCM-IH is going to provide technical expertise on mine planning and safety, as well as access to machinery.

ASM in Zambia

For Zambia’s people, ASM is an important economic activity, providing supplementary income for agricultural communities and seed money for small-startups. Although the size of the sector is unknown, it is estimated to employ around 13m people.

This sector used to be concentrated on emeralds and amethyst mining, but recent discoveries of gold and manganese, which is used in batteries, have seen new surges in extraction that have spiked government interest.

The Zambian mining minister has said he wants the country to produce 40,000kg of gold in 2020. Some major mining operations produce small quantities of gold as a by-product, but this target would include gold from artisanal miners as well.

Zambia’s mining sector, like many others, faces huge pressures going forward due to unforeseen disasters like Covid-19, but also because of the country’s over-reliance on revenue from mining. This has seen clashes arise between the government and the major miners.

Perhaps to derive more revenue from its resources sector, Nasir Ali, PwC country senior partner, says the government should instead think long term and consider adding value from more downstream activities.

He further added that the main aim should be to add value by building factories and making wires, fuses and other consumer products out of the copper produced; then sell it at 10 -15 times the price. However, he asserted that this means a huge investment in infrastructure and bringing in technical skills.

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