Artisanal Gold Mining and Rural Development Policies in Mozambique

Futures 62 (2014) 120–127

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Futures

jo urnal homepage: www.elsevier.com/locate/futures

Artisanal gold mining and rural development policies in

Mozambique: Perspectives for the future

a, b

Stefaan Dondeyne *, Eduardo Ndunguru

Department of Earth and Environmental Sciences, University of Leuven, Belgium

Provincial Directorate for Mining and Energy, Manica Province, Chimoio, Mozambique

A R T I C L E I N F O A B S T R A C T

Article history: Despite Mozambique’s great natural resource wealth and strong economic growth, rural

Available online 20 March 2014

poverty remains high countrywide. The challenge is thus ﬁnding ways to turn this wealth

into development opportunities. For many rural people in central Mozambique, artisanal

Keywords: gold mining is the most direct source of income and this is most likely to remain so.

Land Law

Drawing on our personal experiences, we reﬂect on the future of artisanal gold mining in

Forest and Wildlife Law

Mozambique. The government’s strategy consists of promoting improved technologies

Mining Law

and encouraging artisanal miners to establish themselves as businesses by creating miners

Natural resources

associations. This has proved successful where the ore allows for sufﬁciently long

Miners association

Devolution exploitation, in practice, where reef gold occurs. The same cannot be said, however, of

Democratisation colluvial or alluvial deposits, where placer gold is mined. Given the variable nature of these

Manica province deposits, accompanying mining activities are relatively short-lived at such sites. In these

Sofala province cases, local authorities and community representatives must play an expanded role in

enforcing good mining practices. Doing so would be in line with the country’s current

decentralisation and democratisation policies in relation to rural development.

1. Introduction

Mozambique is a paradox: despite being rich in natural resources, it ranks amongst the world’s ‘poorest’ countries. On the

2012 Human Development Index, Mozambique ranks 185 out of 187 countries, with Niger and the Democratic Republic of

Congo sharing the last position [1]. The country has been praised by the international community for its economic growth,

which exceeded 8% annually from 1993 to 2010, making it the fastest growing, non-oil economy in sub-Saharan Africa [2].

This growth, however, has only had a marginal impact on poverty reduction as it has been driven by foreign investment in

large-scale mining and energy projects, creating few jobs and spawning few linkages to the local economy [3].

In general, the region’s enormous and largely unexplored geological resources present a vast potential reserve of wealth

[4]. For Mozambique, as Ansell [5] explains, its natural capital represents 49% of total wealth (4644 USD per capita), which is

more than double the average (24%) in sub-Saharan Africa. Natural capital is here deﬁned as ﬁnite resources (mineral assets),

renewable resources (forests, lands) and environmental services. But as is the case in many African countries, including its

neighbours, Mozambique is challenged with using its natural resource wealth productively for development.

* Corresponding author. Fax: +32 16 37 21 52.

E-mail addresses: [email protected] (S. Dondeyne), [email protected] (E. Ndunguru).

http://dx.doi.org/10.1016/j.futures.2014.03.001

S. Dondeyne, E. Ndunguru / Futures 62 (2014) 120–127 121

Since the late 1980s, the Government of Mozambique has complied with recommendations of international

institutions to liberalise its economy and adopt export-based development strategies [6,7]. In line with neoliberal

economic principles, the government’s rural development strategy has sought to increase agricultural production by

promoting the private sector and by minimising state interventions. To create conditions favourable for luring investors

to exploit and develop the country’s natural resources, the government implemented a policy and institutional

framework for natural resource management. Its main pillars are various pieces of legislation dealing with natural

resources, such as the Land Law, the Forestry and Wildlife Law, the Mining Law and their related regulations and annexes

[8].

The Land Law (Lei de Terras, N8 19/1997) was intended to provide ﬂexible rules to foreign parties for accessing land,

while securing local people’s customary rights. According to the Mozambican Constitution, all land is property of

the state, but the current Land Law also recognises local people’s rights to land for sustaining their livelihoods. Local

people can have their user rights formally recognised, through what is called a ‘delimitation process’ [9]. This

allows local people to identify the boundaries of their community land during a participatory mapping exercise. The

land title certiﬁes the community customary rights but does not exclude other persons or investors from acquiring

land-use rights. For rural communities, the delimitation process is important as it puts them in a stronger negotiating

position whenever investors want to undertake activities on their land, such as commercial farming, forestry, tourism or

mining.

The Forest and Wildlife regulation (Decree 12/2002) mandates that 20% of tax revenues levied on the exploitation of

natural recourses – timber, hunting, or tourism – is reverted to local communities. Although land delimitation is not

speciﬁed as a requirement, whenever communities have had their land rights registered, it has been easier for them to claim

and secure their share of tax revenues [10]. The principal of reverting 20% of tax revenues, however, is not applicable to

mining operations.

The Mining Law (Lei de Minas N8 14/2002) principally regulates large-scale, industrial mining. The aim of the law is to

govern ‘the rights and obligations regarding the use of mineral resources taking into account the environment, aiming its

rational utilisation to the beneﬁt of the national economy’ (Article 1). Five types of mining licences can be issued in

Mozambique:

(a) A reconnaissance licence, for up to two years, which is not renewable;

(b) An exploration licences, for up to ﬁve years, and renewable;

(d) A mining certiﬁcate, for a maximum of two years, and renewable; and

(e) A mining pass, for up to one year, and renewable.

Artisanal miners are required to obtain a mining pass which, according to the law, can only be granted to Mozambican

citizens. It allows holders to work in areas designated for artisanal mining (Decree N828/2003/Section VII). Whereas the

‘mining passes’ are granted at provincial level by the Provincial Governor, the ‘designated areas’ are declared, modiﬁed or

extinguished at the national level by the Minister of Mining. Initially, nationwide, only 48 areas had been designated for

artisanal mining (Ministerial Circular, Nr 77/94 of May 2006). But crucially, in Central Mozambique, none of these

‘designated’ areas were locations where gold was known to occur, although 65 artisanal gold mines are known in the area

[11,12] (Fig. 1).

Drawing on personal experiences of working with artisanal miners in Central Mozambique, we reﬂect on the successes

and difﬁculties encountered with the implementation of the government’s policies for the sector. First, we highlight the

importance of artisanal gold mining in Central Mozambique. Secondly, we share views from artisanal miners on the positive

and negative aspects of their mining activities, and their perceptions of current and future trends. Thirdly, we analyse the

policy, challenges and dilemmas brought about by artisanal mining. Finally, we reﬂect on the sector’s future, particularly in

the context of rural development.

2. Gold mining in Mozambique

Gold mining has a long history in Mozambique. It dates back at least 1000 years in what is currently the central part of the

country and Zimbabwe. Indeed, long before the arrival of the Portuguese to south-eastern Africa in the late 15th century, gold

was exported along trade routes linking southern and eastern Africa to the Middle East, India and China [13,14]. In the

colonial period, mining was developed at an industrial scale, providing employment to local people. During the civil war

(1977–1992), mining activity was brought to a standstill as a large part of the population had taken refuge in neighbouring

countries or to more secure areas. With the instauration of peace, returning populations began engaging in artisanal mining

[11].

In recent years, gold production in Mozambique has increased noticeably. During the period 2007–2011, recorded annual

output was in the range of 600–900 kg, of which not more than 100–500 kg was ofﬁcially recorded [15]. At an average price

of 1000 USD/ounce, this would correspond to a value of 19–29 million USD annually. Despite the government’s efforts to

create favourable conditions for industrial mining, gold has almost exclusively been produced by artisanal miners over the

last two decades [11].

122 S. Dondeyne, E. Ndunguru / Futures 62 (2014) 120–127

Fig. 1. Areas ‘designated for artisanal mining’ and actual artisanal gold mines in central Mozambique.

In many countries, governments regard artisanal and small-scale mining as an illegal activity. Attempts to eradicate

‘illegal’ artisanal mining have invariably proven to be very difﬁcult [16,17]. In relation to artisanal mining, state authorities

face three major challenges: (1) ensuring that the trading is formalised such that national revenues and foreign exchange are

not lost to the country; (2) ensuring that the safety of miners is maximised while health hazards for the general public are

minimised; and (3) minimising the environmental consequences of often chaotic exploitation [18,19]. In Mozambique, the

artisanal mining sector is large, populated by more than 150,000 people who are engaged in the extraction of gold,

gemstones, tantalum and industrial minerals. At least 60,000 people are estimated to be employed in artisanal gold mining

alone [2,15]. Recognising both the economic and social importance of artisanal mining, the government implemented the

2003 mining decree (Decree N828/2003) which established a framework to assist with regularising this hitherto illegal

activity.

So far, the government’s position on artisanal mining has been to give technical support to operators with a view to

encourage environmental best practices and to encourage miners to form associations [20]. Where artisanal gold miners

have been registered as an association, they have also obtained licences as ‘mining certiﬁcates’. In the province of Manica, six

artisanal mines have mining certiﬁcates: Munhena and Mimosa in Manica District; Bandire and Tsetsera in Sussundenga

District; Kumboedza in Barue´ District; and AMACOD in Macossa District. Together, these mines employ approximately 1400

people. In Sofala Province, a seventh association has recently been registered at Tsiquiri, in Gorongosa District (Fig. 1).

The Mining Development Fund (Fundo Fomento Mineiro in Portuguese) was created with the principal objective of

promoting amongst artisanal miners the use of improved mining technologies that minimise the environmental impact and

improve the miners’ safety. The Mining Development Fund, as a government agency, was also actively buying artisanal

produced gold at a price close to the world market price. The aim has been to minimise ‘‘leakages’’ of gold to the informal

market. This has only been partly successful, because informal buyers also provide artisanal miners with mercury to

amalgamate their gold [21]. Recently, the Mining Development Fund has been transformed into two new entities: a private

company ‘‘Empressa Moçambicana de Exploraçaõ Mineira’’ which has the mandate of buying gold on behalf of the Government,

and the Institute for Mining Geology (Instituto Geolo´gico Mineiro), tasked with providing technical assistance to artisanal

miners [22].

3. Artisanal miners’ views through video

In collaboration with artisanal miners in Manica District, we produced two videos which provide insights into operators’

lives. The ﬁrst video concerns a mine in Chazuka, where placer gold is extracted by a group of people who do not have any

licence. The second video, footage from Munhena, concerns the biggest artisanal mine in the area. Here, reef gold is mined

S. Dondeyne, E. Ndunguru / Futures 62 (2014) 120–127 123

and it is the location of the ﬁrst miners association. The videos are ‘participatory videos’ in the sense that the miners are both

subjects and co-producers in a process of community reﬂection and action, in accordance with Fabel [23]. Both videos can be

accessed at http://vimeo.com/album/1513692.

3.1. The miners of Chazuka

‘‘No bad thing comes without any good thing to it,’’ said Firmino Maronda, head of a group of gold panners working in the

locality of Chazuka. Mr. Maronda made this statement during the recording of a video in which gold panners explain how

they extract gold from colluvial deposits. Having trained as a teacher, he explains that just after the civil war, he worked for a

resettlement programme for refugees. Towards the end of his assignment, he realised that some of his friends had gotten rich

by gold mining, so he decided also to try his luck. In the video, the miners explain how they use old irrigation canals for

panning placer gold. Though they do not use mercury, Mr. Maronda further explains that they resent polluting the rivers with

the sediments. He therefore pleads for the government to provide technical assistance to solve this problem. He also shows

that, wherever possible, they do trap sediments by making bench terraces suitable for agriculture. He further stresses that

the money they get from the gold helps them to improve their farming, enabling them to buy seeds and fertilizers. Thanks to

the gold mining, people are able to build better houses and buy cattle; some of them even buy cars and get into the transport

business. With improved transport facilities, people now ﬁnd it easier to go to town, and farmers ﬁnd it easier to sell their

produce. The gold also makes it possible for their children to study, and so he foretells that one day, some of them will

become teachers, nurses, doctors and even ministers. He concludes that, despite the perils and hard work, they really cannot

do without the gold mining.

3.2. The miners of Munhena

In the video ‘‘The history of our mine’’ , the miners of Munhena explain how the site was discovered and how they

organised themselves by forming a miners association. They show how they process the ore in basins outside of the riverbed,

how they use improved sluices provided by the [former] Mining Development Fund, and how they use retorts for recovering

gold and distilling mercury. Strikingly, when explaining the process of creating the miners association, Mr. Armando

Takarindwa, the vice-president of the association, explains that as there were so many people working in the mine, they ﬁrst

created a unit of the ruling party. Then, mining technicians came to interact with them and assisted with creating a miners

association. They started the legalisation process in 2001, but it was only in 2004 that the process was concluded. Finally, Mr.

Takarindwa also explains that they recently formed a partnership with an industrial mining group. They so expect that they

will be able to extract ore veins now inaccessible to them and to access better equipment for processing the ore.

4. Challenges and policy dilemmas

The views and concerns expressed by the miners in Chazuka epitomise the challenges and dilemmas faced by operators in

Central Mozambique, and more broadly, in developing countries. The wealth of mineral resources laying within reach of an

impoverished rural population offers local people a glimmer of hope, though often illusory, of escaping from poverty quickly.

The soaring international price of gold – which in 2003 was less than 400 USD/ounce and which in 2012 peaked at 1670 USD/

ounce [24] – has been one of the major drivers of the sharp increase in artisanal gold mining activity in Mozambique. In

Central Mozambique speciﬁcally, by the end of the 1990s, fewer than 10,000 people were involved in artisanal mining;

today, they are an estimated 25,000. After agriculture, artisanal mining is the biggest source of employment and for many

rural people, gold mining is the most direct means of ﬁlling gaps when income from crop production is low [25].

In practice, the government’s efforts to promote safer mining techniques and environmentally friendly efforts have been

successful where it has been possible to organise miners in associations. In Bandire, for example, miners are now excavating

reef gold along benches, which was not the case in 2005 (Fig. 2). In this way, the stability of the exploitation front is improved,

and so is the miners’ safety. Retorts, aimed at reducing exposure to mercury vapour and preventing mercury from spreading

in the environment, have also been introduced in these mines [12,26].

However, most artisanal miners extract gold from colluvial and alluvial deposits – as illustrated by the video of the mine

in Chazuka. Given the variable nature of these sedimentary deposits, mining activities at any particular site are relatively

short-lived, typically a few months, while their discovery often sparks gold rushes (Fig. 3). The miners camp in shelters

around the mine site, where health and sanitation are far from desirable. At such mines, it is not uncommon to encounter

children working, while safety measures are very poor; deep mining shafts and galleries which have not been stabilised can

be particular dangerous. The processing of ore occurs in the river, resulting in high sediment loads. Though mercury is not

commonly used where placer gold is found, wherever it is used, part of the mercury is directly discharged in the rivers. It

‘‘Kushata kwe zwimwe, kunaka kwe zwimwe’’ [No bad thing comes without any good thing to it] (2008) – Artisanal gold miners explaining how they

extract gold, discuss its environmental effects and self devised mitigation efforts. Shona and Portuguese with Portuguese subtitles, 13 min – available at http://vimeo.com/18987154 (accessed 12.02.14).

A historia da nossa mina [The history of our mine] (2008) – Artisanal miners telling the history of their gold mine and their expectation from the new joint

venture with an industrial mining group. Portuguese, 13 min. – available at http://vimeo.com/18986780 (accessed 12.02.14).

124 S. Dondeyne, E. Ndunguru / Futures 62 (2014) 120–127

Fig. 2. Bandire a mine where reef gold is extracted (Sussundenga district): (a) originally excavation was done in a chaotic way compromising the stability of

the embankment and hence miners’ safety (photo of November 2005); (b) today, extraction is done in a more systematic way along bench terraces (photo

June 2012).

would be naive – though a mistake often made – to assume that at such sites, people do not have their own social

organisation. The miners in Chazuka are proof of this: they work under a headman and follow rules for sharing the proﬁts.

They all happen to be members of a religious group adhering to very egalitarian principles. As a rule, they share all of the

proﬁts equally amongst the group members but with the landlord receiving an equal share. In general, we often observed

that miners work in bands of four to six people and that they have to negotiate with others where they are allowed to work.

They may team up with other bands to form a larger group controlling a river section and mining site. Still, the social

dynamics of such groups lack formal organisation and are very ﬂuid. Where placer gold is mined, it can therefore not be

expected to get artisanal miners organised in the same way as where reef gold is mined. To work with these groups of miners,

more ﬂexible approaches are needed.

Over the last decade, whenever reconnaissance surveys were conducted in the area, the work always attracted artisanal

miners. Government authorities struggle to control artisanal miners, which is one of the factors that has discouraged foreign

companies from investing in large-scale mine development. Given the lack of alternative employment activities in rural

areas, and the high return artisanal mining offers to the rural population, the sector will likely continue to be important in

Mozambique, even if the price of gold were to dip noticeably. Furthermore, having a secure livelihood is a fundamental

human right, and where people strive to attain this through artisanal mining, this choice deserves as much recognition as any

other livelihood strategy. Moreover, just as Cartie and Bu¨ rge [27] have argued in the case of Sierra Leone, the miners of

Chazuka also make the point that agriculture and artisanal mining are not alternative livelihood strategies, but indeed

complement each other. As Nielsen et al. [28] demonstrate for Central Mozambique, gold mining and commercial forest

products are important in rural people’s livelihood strategies as a means of diversifying their sources of income. Where gold

is relatively abundant, as in Central Mozambique, gold mining should, therefore, be recognised in rural development

strategies, and by extension, in any area where artisanal mining is common.

S. Dondeyne, E. Ndunguru / Futures 62 (2014) 120–127 125

Fig. 3. A mining site where placer gold is extracted in the Revue´ river basin (Manica district): (a) in July 2007, in a true gold rush the site was invaded with

hundreds of miners; (b) in September 2008, the sites was already abandoned.

5. New trends and future perspectives

The international consultancy company KPMG, stated in a report [29] that Gold production in Mozambique is expected to

increase signiﬁcantly, albeit from a low base, driven mainly by Auroch Minerals Manica Gold Project which is expected to

come online. Despite being largely overshadowed by its booming coal sector, gold is still expected to boost the mining

industry and economy. By 2017, Mozambique’s gold production is expected to increase from 25,000 ounces in 2011 to

85,000 ounces by 2017. (p. 16)

Despite failures over the last decades of industrial gold mining companies in Manica, KPMG still expects that this increase

will solely come from industrial mining; the report does not even mention the gold production from artisanal mining.

Whatever it may be, it is clear that artisanal mining will continue to be an important economic activity in Central

Mozambique. On the one hand, many gold deposits are too small for industrial exploitation. On the other hand, it is often the

only opportunity for rural people to secure an income outside agriculture.

In 2005, the partnership between the Association of Artisanal Miners of Munhena and ‘‘AMAN Capital Investments’’, an

industrial group , appeared as a new phenomenon. The partnership led to the introduction of excavation galleries, the

installation of a processing plant and improved environmental management. For the artisanal miners, the main advantage, it

seemed, was that they would be able to continue mining ore that was inaccessible using their simple tools [11]. Though the

joint venture did not prove to be long lasting, it has helped the artisanal miners to expand the scale of their exploitation.

Whereas less than 15 years ago, artisanal mining was illegal, today, artisanal miners associations are recognised and operate

as small enterprises. Through alliance with industrial mining companies, as the case of the Munhena mine, but also from

experiences gained from working at industrial mines in South Africa, miners are improving their mining techniques and

expanding their operations. In this way, mining techniques are spreading that enable operators to extract gold using deep

shafts and galleries. What we are actually seeing is that the miners’ associations are becoming more professional and

growing into small endogenous enterprises. Another example of the increasing professionalism of the sector is the union

UMIMA (Unia˜o dos Mineradores de Manica) created by associations of artisanal miners in 2010. Its purpose is to advise its

members on legal and administrative matters, and also to promote more efﬁcient and environmentally more friendly mining

techniques. The union also promotes alternative economic activities, ranging from ﬁsh and chicken farming to the

development of markets for trading ordinary commodities.

With 1t oz = 31.103 g, this is from 778 kg to 2644 kg.

See, A historia da nossa mina [The history of our mine] (2008) – available at http://vimeo.com/18986780 (accessed 12.02.14).

126 S. Dondeyne, E. Ndunguru / Futures 62 (2014) 120–127

As unregistered gold buyers are supplying gold panners with mercury, government authorities have not been successful

at controlling its use. It is therefore hard to foretell what the effect will be of the recent European and American export ban on

mercury [30]. Meanwhile, the Ministry of Mineral Resources in cooperation with the Ministry for the Coordination of

Environmental Action is investigating the possibility of substituting mercury with borax, which thus far has had promising

results. It further remains to be seen whether the newly-created Empressa Moçambicana de Exploraçaõ Mineira, entrusted

with the task of purchasing gold, will be able to gain a larger share of the informal market. Similar to the agricultural policy,

the government seems to be banking on the private sector. The experience from the agriculture sector is that liberalisation is

fraught with difﬁculties, and that it did not facilitate increased production [3]. The attempt, for example, to create an

important agro-business sector in central Mozambique by attracting Zimbabwean farmers failed [6].

On the possibility of introducing and adopting retorts in Central Mozambique, Spiegel et al. [21] observed that barriers for

widespread adoption of new technologies include poverty, lack of knowledge and trust, together with the free supply of

mercury. Our experience shows that, where miners can be organised in associations, it is possible to introduce new

technologies for allowing safer exploitation and reducing the environmental impact of mining. Having such an

organisational structure allows for social control mechanisms and so indeed contributes to the building of trust. As with any

entrepreneurial organisation, trust among the miners depends in the ﬁrst place on internal rules and agreements on tasks

and responsibilities as well as the sharing of beneﬁts. To arrive at such a structure, however, requires social stability over a

sufﬁciently long time which, in practice, only occurs where reef gold is mined. Geologically, it means that the ore deposits

need to be predictable and large enough to have a long-term exploitation. In such cases, the current policy and legal

framework is indeed adequate. Nevertheless, it requires a high level of commitment on the part of mining technicians who

are willing to collaborate closely with miners at the site, and equally, the institutional willingness to provide such technical

assistance. Where placer gold is exploited, the situation is, however, more complex. In such cases, a more ﬂexible strategy is

required, whereby local authorities and community representatives could take up a greater role.

Since the peace instauration in 1992, the Government of Mozambique has been adjusting its relationship with rural

population and local authorities [31]. This process has been accompanied by different forms of democratisation such as

multi-party presidential and parliamentary elections and by decentralisation, whereby some authority has been devolved to

local administrations and local chiefs have been reinstated [32]. The process also led to the formulation of the new Land Law

and the Forest and Wildlife Law and regulations. Though the rule of revolving 20% of tax revenues from the exploitation of

natural resources is not applicable to mining, in the current spirit of decentralisation and democratisation, it should be

possible to work out a similar regulation for the mining sector. Local authorities, at the level of the district and locality

together with community representatives, could be given the authority to control artisanal mining on community land. The

Land Law provides a framework for identifying and recognising community land, including the establishment of community

committees which can take up such a task. These committees could assume a role in ensuring that artisanal miners would

have a mining pass and that minimal mitigation efforts are made. In return, and similar as foreseen by the Forest and Wildlife

regulation, communities should then get a percentage of the revenues from the mining.

6. Conclusions

In Central Mozambique, artisanal gold mining is important to the economic development of rural people as, besides

agriculture, it is the single largest opportunity of employment. To rural people, artisanal gold mining is also the most direct

source of monetary income. Given the importance of gold mining to rural people, artisanal mining should be included in rural

development policies. As a general policy for rural development, the Government of Mozambique has made strident efforts

to improve the relationship between state and rural people since the instauration of peace in 1992. The overall trend has

been one of decentralisation and democratisation, whereby more authority has been given to local administrations, and rural

communities and traditional authorities have been given greater recognition. This policy aimed to promote agriculture,

forestry and tourism while at the same time secure local people’s access right to natural resources. In the same vein, the

government has recognised the social and economic importance of artisanal mining. The current trend amongst the miners

association is one of increased professionalism and expansion of their operations. With regard to artisanal gold mining, the

current policy and legislation is adequate to promote safer and more environmentally-friendly techniques, but only where

the geologic conditions allow exploitation for a period sufﬁciently long to establish miners associations. In practice, this has

only been the case where reef gold is exploited. Where placer gold is mined, these conditions are usually not met. In the

future, a more ﬂexible strategy must be developed whereby some authority should be devolved from national and provincial

level to the levels of the districts, localities and communities. If local authorities and community representatives would be

given an expanded role in controlling artisanal mining, it should be possible to promote safer mining practices across a much

wider area. In return for their involvement in controlling artisanal mining, local communities should receive a percentage of

the revenues from the mining, as foreseen for other natural resources under the Forest and Wildlife regulation.

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