ghana: poverty and social impact analysis of the artisanal and small scale mining sector

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Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector Kristina Svensson World Bank Sustainable Energy Division - Oil, Gas, and Mining Department PSIA Learning Days, March 14, 2013

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Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector. Kristina Svensson World Bank Sustainable Energy Division - Oil, Gas, and Mining Department PSIA Learning Days, March 14, 2013. Why artisanal and small scale mining?. - PowerPoint PPT Presentation

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Page 1: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Ghana: Poverty and Social Impact Analysisof the Artisanal and Small Scale Mining Sector

Kristina SvenssonWorld Bank Sustainable Energy Division - Oil, Gas, and Mining DepartmentPSIA Learning Days, March 14, 2013

Page 2: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Why artisanal and small scale mining?

Large-scale mining company influx during 1990-2000s;

500,000 to 1 million miners, majority illegal on large scale concessions;

Today small-scale mining is 28% of total Ghana gold production;

Negative social and environmental impacts, land conflicts;

Increasingly mechanized and with foreign investments (Chinese).

Page 3: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

PSIA Objectives1. Inform Government of Ghana (GoG) policies

and practices related to ASM by producing new data on the sector, and new analysis;

2. Inform the preparation of the next phase of Bank support for NREG, specially with regards to mining sector activities;

3. To facilitate the creation of a platform for dialogue and consultations among a range of ASM stakeholders

To assess the poverty, welfare, and social impact of the Small-Scale Gold Mining Law (1989) ex-post, and do an ex-ante assessment of the revised Draft Mining Policy

Page 4: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Methodology

Limited primary data: Desk- and field study (Japa in Wassa Amenfi East District)

Limited use of “counter-factual”◦ Lack of comparable countries◦ Problem with national data

Participatory space and dialogue

Political economy

Transmission channels for tracing impact of policy reforms:◦ Employment◦ Prices ◦ Access ◦ Assets ◦ Transfers◦ Taxes and authority

Page 5: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Key PSIA findings

1. Artisanal and small scale mining today in Ghana can be a wealth creating sector - not necessarily “poverty driven” or “get-rich-quick” phenomena;

2. Current licensing and access to land regimes are not working for majority of artisanal and small-scale miners, and leads to illegality, conflicts, and human rights abuses;

3. There are important regional differences within Ghana in terms of how well existing ASM policies work.

Page 6: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Livelihood matrix for typical small-scale gold “pit” (Japa, 2012)

Productive chain activity

Number of workers

Gender (adult unless stated)

Average Income (Cedis)

Hours worked

Excavating 1 Male 1,000/month 8 hours/dayShovelling/ feeding grinder

21 Male 200/week* 90 hours/week

Washing on site 7 Male 300/week** VariesTransport concentrate off site in cars

1 Male 100/week** Varies

Second round processing of concentrate off site

1 Female (teenage women and older rather than young

girls)

N/K 4 hours/week

Fetching and reprocessing “tailings”

14 Male (boys) Independent operators

[55 per ‘blade’(0.8 grammes)]

Varies

Off site cooking and delivery of “chop” on site

2 Female Independent service provider

(Approx 30/week)

Varies

On site cleaning of grinders with knives

? Female N/K Varies

On site Ata Buata maintenance work (cleaning the washboards)

? Female N/K Varies

Page 7: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Distribution of wealth in small-scale mining community of Japa

Social mobility CharacteristicsVery Rich(12 households)

Luxurious carsOwn excavatorsMansionsLots of moneyLandowner

Rich(50-60 households)

Own prosperous small business (e.g. beer bar)Some buy cocoa farms (up to 10 acres)Considerable amount of cash flowOwn land and have their own plots (although not as rich as other land)Rent an excavatorThey have sponsors

Semi-rich(500+ households)

Accumulate money and keep it in the bankBuy water pumps + tube for hiringWork in the pitsYoung men/’youth’Different types of housesPublic standpipe and filtered waterLarge cocoa farmersSmall shop owners

Poor(500+ households)

No access to galamsey landNothing to do with galamseySalaried workers, civil servantsYou can’t build your own houseLive in mud houseSmall subsistence cocoa farmsYoung girls (15-18) with babies but no fatherWidows

Page 8: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Licensing and Access to Land

Illegalityconflict human rights

abuses

Policy focus to attract

large scale mining

investments

Lack of access to

geologically suitable land for

ASM

Lack of land-use planning

taking ASM into

account

Expensive and

complicated licensing procedure

Page 9: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Regional mining frontiers

Page 10: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Proposed policy approaches

PSIA Findings Proposed policy approach1. ASM can be a wealth-creating sector, but currently treated as poverty-driven.

-Fiscal policy/taxation of ASMs;-Communication to change mind-set and debate;-Continued broader regular dialogues with all stakeholders.

2. Regional differences in policy effectiveness – Designated area approach not working in regions with LSM.

Dynamic approach to designated area approach and adapting support services

3. Licensing and access to land not working for majority of ASM -leading to illegality and human rights abuses.

-Categorization of miners in regulations;-Licensing regime needs to be decentralized and simplified;-Access to productive land for ASM prioritized;-Dialogue with large scale mining companies, and other institutions

Page 11: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

What worked?Despite initial weak

government participation, the PSIA helped to open up policy space;

“Social inclusion” on agenda, but more focus on sector reforms;

Strong engagement with other stakeholders (miners, NGOs, large scale companies);

Part of series of programs and activities – would not have worked as a one-off activity.

Page 12: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Lessons learnedDifficult policy environment – strong

political preference to focus on continuing to attract and retain large scale mining;

More primary data needed to show economic impact of ASM in communities;

Stakeholder engagement useful, but more needed with NGOs and communities and chiefs/stools needed;

Political economy analysis useful in showing political power of ASM.

Page 13: Ghana: Poverty and Social Impact Analysis of the Artisanal and Small Scale Mining Sector

Thanks for your attention!