Standing on Gallery Gold’s (now Iamgold’s) Busolwa Hill in Tanzania and looking at the windlasses as typically shown in Figure 1, it was easy to recall those famous woodcuts of Georgius Agricola in his De Re Metallica of 1556 in which he depicted the mining practices of the 16th Century mining centre of Joachimsthal in Czechoslovakia. In many parts of the world little has changed from those 292 woodcuts especially in Artisanal Mining Camps.

Mining practices are basic and although the sorting methods are often primitive, they do work such as winnowing cassiterite by people blowing away the less heavy particles in shallow bowls or tossing the particles in the air from a blanket and letting the dust fly off to leave the heavier particles behind.

In the Artisanal Mining paper it was estimated that there are currently between 5million and 6million people directly employed by ASM in Africa with the heaviest concentrations (>200,000 people per country) in the DRC, Eritrea, Ethiopia, Ghana, Tanzania, Mali and Zimbabwe. The artisans have different group names depending on the country, being cresseurs in the DRC, warare in Ethiopia, galemsey in Ghana, diggers in Sierra Leone, nyonge in Tanzania, panners in Zimbabwe, orpailleurs in many West African Francophone countries and garimpeiros in southern Lusaphone (Portuguese) countries.

The reasons for such high levels of employment (and expected growth) in the ASM sector were that at least 40% of Africa was below the US$1 per day poverty line with many people forced into the sector due to crop failure, drought, armed conflicts (at least 25 armed conflicts have occurred since 1963 affecting 20% of the continent’s population), and national and regional economic decline resulting in ever dwindling livelihood choices. There is also the multiplier effect of increasing orphanhood due to HIV/AIDS, and an increasing number of ASM workers being female (40% to 50%) and/or children.

ASM is regarded as often the only means to provide income for numerous poor and rural Africans, it provides work and a knock-on effect in local communities in demand for food, equipment, housing and tools. Though theoretically often illegal, ASM appears to be encouraged by most governments – understandably with an estimated up to US$1bn generated by the ASM sector in gold and gemstone revenue in Sub- Saharan Africa each year.

It explains why artisanal workers are able to operate seemingly illegally on a number of mine sites, yet how the government can encourage them to move on, when required.

However, ASM has an appalling reputation for health and safety, with exposure to mercury and chemicals, rock falls and ground failures, poor lighting and narrow working environments, poor organisational groups etc. ASM is also environmentally destructive, unsustainable and promotes deteriorating health conditions such as various diseases.

It was accepted that Governments often did not have the resources to improve conditions for ASM workers and the large scale miners should become involved. This was happening such as by Gold Fields near Damang in Ghana, Anglogold Ashanti near Geita in Tanzania, and a number of development agency programmes.

Consequently it can be seen why the ASM sector is still growing in Africa, however, some of the larger companies were becoming involved to improve the “lot” of the ASM worker. We have seen a number of artisanal workers and workings in China too, whether the larger companies are going to become involved and also improve the “lot” of such workers remains to be seen.

Disclosure and Disclaimer : This article has been written by Keith Goode, the Managing Director of Eagle Research Advisory Pty Ltd, (an independent research company) who is an Authorised Representative with Taylor Collison Ltd, and with his associates, may hold interests in some of the stocks mentioned in this article. The opinions expressed in this article should not be taken as investment advice, but are based on observations by the author. The author does not warrant the accuracy or completeness of any information and is not liable for any loss or damage suffered through any reliance on its contents.

Figure 1. Windlass and Shaft on Busolwa Hill in Tanzania