Letter to the AFRIMAG Editor following the publication of the article: "Clandestine gold panning continues to undermine West Africa”

Article available here in French

Mr Ben Slimane,

Thank you for your paper on gold panning more commonly called Artisanal and Small-scale Gold Mining (ASGM) in West Africa. I must admit that after reading it, one comes out quite frightened and above all disgusted and upset against the ASGM sector which, to date, supports more than 10% of the population of the three countries that you mention (Burkina Faso, C?te d'Ivoire and Mali) that is 1.5 million miners or 7.5 million dependents out of a total population of 70 million inhabitants.

Pillorying 10% of the population of three countries is not insignificant, especially with the qualifiers and images you use: pollution, traffic, illegality, considerable losses for the public treasury , colossal loss of earnings , damages, easy gains , losses which are calculated in tens of billions of dollars , criminal organizations, trafficking and prostitution, human rights violations, child labor, terrorists taking advantage of gold veins and taxing a large part of the production , disastrous impact on the environment and health are just a few examples of your qualifiers.?

Furthermore, you charge to ASGM the cause of disputes with industrial mines which enjoy mining permits in due form and which implement sounder and more responsible practices for your lands, which invest massively in the safety of their employees, whose royalties which they pay constitute a crucial financial windfall and you finally accuse ASGM miners of being the cause of their hesitations to invest in the region by citing as an example the attack on May 16 of 8 employees of an industrial mine in Houndé, Burkina Faso.

You mention, however, that ASGM represents jobs, that it is inconceivable to put an end to it and that because of its social and economic importance, it is necessary to better regulate it.

I strongly speak out against the way in which you portray ASGM and I am going to offer you a rereading of the situation or rather I will put it in perspective that will allow those who read us to understand ASGM and more broadly, mining in another more realistic and balanced way.

First of all, you talk about illegality (cited 7 times) and clandestinity (cited 8 times) and never mention the qualifier 'informal'. International organizations speak rather of informal activities and the ILO in its report published in 2019 on 'Women and Men in the informal economy' places the share of informal employment in total employment at 95% in Burkina Faso and 93% in Mali and C?te d'Ivoire. So why not qualify almost the entire economy of these three countries as illegal or clandestine rather than informal??I think that in a country where informality reigns, one cannot qualify part of its economy as illegal or clandestine without including all the sectors in this denomination because they represent more than 90% of the employment generated. ASGM is a reflection of the country's economy and employment. Call it illegal or informal, but don't stigmatize an activity by calling it illegal when everyone calls the rest of the economy informal.

Then you mention child labor. Like informality, child labor in ASGM also needs contextualization. In Africa, according to the ILO , 41% of children are economically active. According to the latest available figures, we are talking about 50% of children aged 7 to 14 in Burkina Faso (2010), 36% in C?te d'Ivoire (2012) and 30% in Mali (2013). Once again, putting into perspective a negative aspect of ASGM in its national context allows the reader to feel that ASGM reflects the economy of the region, namely mostly informal or illegal if you prefer and where child labor exists like in the rest of the economy.

You also mention prostitution, but this phenomenon is general in mining. The work is hard and the miners are often far from their families. Besides, it's no coincidence that the only state that has legalized prostitution in the USA, Nevada, happens to be by far the leading gold-producing state in the country with, for example, 3 brothels in the city of Elko, hometown of one of the largest and oldest industrial gold mines in the United States. Nothing abnormal then, as we know: mining activity fuels prostitution due to the remoteness and isolation of its workforce.

You then mention terrorist groups who take advantage of the gold veins or who profit by taxing a large part of the production. On this point, it is enough to go to the travel advice sites to see that the whole of Mali as well as the majority of the territory of Burkina Faso are classified as Red zone or 'formally not recommended' the rest of Burkina being classified as Orange zone or 'not recommended unless compelling reason'. The security situation in these two countries is fragile and terrorist groups are gaining ground. The number of victims proves it. These terrorist groups control entire territories where the state has little or no presence and as they are excluded from the traditional financial systems, they 'tax' as you say, in exchange of a certain security, the AGSM sites. The gold they levy is a currency that they then exchange for weapons, for example. Terrorist groups, rather than attacking the surely well-guarded central bank safe, prefer to attack the weak link, namely the ASGM miners who often operate in isolated areas. It's easier for them and their loot is a globally accepted currency: GOLD. This is the real reason for the intrusion of armed conflict into ASGM. ASGM miners are among the first victims of a terrorism or conflict that neither the state nor the international community are able to contain.

You then mention the financial losses of tens of billions of dollars, the easy gains, the 'colossal' shortfall or the considerable losses for the public coffers. First of all, we must keep a sense of proportion; 20 billion dollars is 350 tons of gold, which is far greater than the entire gold production of the 3 countries you are talking about (241 tons in 2021) of which ASGM represents, according to experts, at most, half. Moreover, it is not because the gold is exported illegally or informally that the country suffers financial losses equivalent to the value of that gold. Indeed, we can assume that at least 90% of the value of ASGM gold remains in its production country and therefore, if we take a high range for the 3 countries of 50% ASGM gold, i.e. 120 tons annually, at the current price of 1800USD per ounce, 90% of which remains in the countries that produce it, this makes an annual value generated of 6.25 billion USD, i.e. for 1.5 million miners and 7.5 million dependents, a value of 70 USD per month per person or 350 USD per month and per miner certainly more than a farmer although the task is much tougher and the money is not easily earned contrary to what you affirm and far from fabulous sums that you mention. In the case of low incomes, this money is spent locally, which sustains a whole section of the local, provincial and national economy and this money indirectly generates taxes for instance, through VAT on goods and services purchased by miners. Thus, a study in which I participated in 2017 in Kenya estimates that the VAT collected indirectly by the sale of minerals from artisanal mining in the country represents 6% of the value of these minerals. So, one cannot say that the state finances are completely cheated. Yes, they are for royalties but not for all countries. The gold in the end is officially exported from a neighboring country and it is the tax differentials that fuel informal exports. Moreover, the informal exports are not organized by the miners who sell their gold at their mine door but it is stimulated and organized by those who need to circumvent the foreign exchange regulations and who use the gold in order to obtain foreign currency abroad (mainly in Dubai) to buy goods which they then import, often undervaluating their customs import value. I described this phenomenon in 2016 in a study on the ASGM gold value chain in Burkina Faso and Senegal. So, again, making miners look like crooks when they are instead victims of buyers who use gold as a currency to evade taxes is an easy shortcut. Finally, the 6.25 billion USD of foreign currency enter the countries whether through imported goods or direct financial flows. This manna feeds the economies and stimulates them. It is therefore not a loss for the countries, just a windfall that is not always channeled through the central banks and at any rate a national value created of more than 6 billion dollars; a robbery in your eyes.

You also oppose ASGM to industrial mining by evoking the disputes with the industrial mines which, for their part, have been given mining permits in good and due form and which implement sounder and more responsible practices for your lands or invest massively in the safety of their employees and who pay royalties which represent a financial windfall. You also conclude that the attitude of gold miners would push or risk pushing industrial mines to flee or make them give up investing because of the risk of confrontation, citing as an example the events of May 16, 2022 in Houndé in Burkina Faso where 8 employees of an industrial mine were attacked following a revolt by ASGM miners. On this subject, I would like to put things in order. First of all, I want to say here that industrial or large-scale mining is as important as artisanal and small-scale mining. There is not one above the other and opposing them is not a solution. Moreover, if we talk about employment, the large-scale mine would rather be the ASGM sector while the industrial one would be the small-scale one. Artisanal mining brings employment with a lot of local and national content, while industrial mining brings royalties and currencies to the nation’s coffers. The right cocktail is therefore to have both an industrial and artisanal sector. However, when the two sectors exploit the same areas, this leads inevitably to conflicts. Often the industrial mine arrives in an area because of an ASGM activity that is an indication that gold is present. In Burkina, if an industrial mine decides to exploit an area where artisanal miners work, the latter must leave and make way for the large-scale mine. We should not be surprised that conflicts break out then and besides we could even be surprised by the absence of royalties paid to the ASGM miners by the mining companies for having enabled them to discover a deposit. This is the rule in the gold industry, the famous NSR (Net Smelter Return) royalty. With regard to the Houndé riots, the population considers that it benefits little from the fallout from the industrial mine and the artisanal miners demand access to the gold resource because they consider themselves legitimate in the area given that they were present before the arrival of the industrial mine. The state, by not organizing dialogue or cohabitation between the two sectors of mining, has only fueled tensions that sometimes end in clashes and tensions as in Houndé.

Finally, you mention harmful environmental impact. You are right but mining in general has a strong impact on the environment. ASGM emits little carbon but the improper use of mercury is inadmissible. However, to use mercury in a reasoned way, according to the best practices imposed by the Minamata Treaty , technology and security are needed, which is incompatible with the informality in which ASGM operates. It is therefore necessary to go through formalization and technology transfer to have an ASGM sector that can tick all the boxes, namely: strong social impact, low carbon emissions, rational use of mercury, strong local and national impact. The key is therefore the formalization and accompaniment of artisanal mines and for this you need political will as well as control of the territory, which is not the case today in West Africa. In any case, it is not with this kind of article that you will contribute to the improvement of the situation. I hope in any case that my answer allows a contextualization of ASGM in a region where it has always existed. Thank you for your attention and all my respects.