Assessment of the Supply Chains of Gold Produced in Burkina Faso
Total Page:16
File Type:pdf, Size:1020Kb
Gold at the crossroads Assessment of the supply chains of gold produced in Burkina Faso, Mali and Niger The Organisation for Economic Co-operation and Development (OECD) The OECD is a unique forum where governments work together to address the economic, social and environmental challenges of globalisation. The OECD is also at the forefront of efforts to understand and to help governments respond to new developments and concerns, such as corporate governance, the information economy and the challenges of an ageing population. The Organisation provides a setting where governments can compare policy experiences, seek answers to common problems, identify good practice and work to co- ordinate domestic and international policies. The OECD Due Diligence Guidance The OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High- Risk Areas (hereinafter “the OECD Guidance”) provides step-by-step recommendations endorsed by governments for global responsible supply chains of minerals in order for companies to respect human rights and avoid contributing to conflict through their mineral or metal purchasing decisions and practices. The OECD Guidance may be used by any company potentially sourcing minerals or metals from conflict-affected and high- risk areas, and is intended to cultivate transparent, conflict-free supply chains and sustainable corporate engagement in the minerals sector. The OECD Council adopted the Recommendation on the OECD Guidance on 25 May 2011, based on a proposal from the Development Assistance Committee (DAC) and the Investment Committee. More information on the OECD’s work in the mining sector can be found at: http://www.oecd.org/corporate/mne/mining.htm The Liptako–Gourma Authority (LGA) The LGA, created in December 1970, is an inter-governmental organisation, composed of Mali, Niger, and Burkina Faso, whose principal mission is to encourage, implement and co-ordinate, at the level of the three countries, any initiatives which will contribute to the region’s harmonious and integrated development. In recent years, the Member countries of the LGA have made efforts to structure, organise and formalise artisanal and small-scale mining, especially for gold. Notes on this study This study was prepared by Roberto Sollazzo based on research carried out in 2018 in the form of an analysis of the literature available on the subject and interviews carried out in Burkina Faso, Niger, Mali and France with key stakeholders in the production and trading of gold, and with representatives of the countries concerned and international organisations. The overall aim of the study is to promote the responsibility of economic actors, and the traceability and transparency of supply chains of gold ores produced in the LGA Member countries. The Inter-Governmental Action Group against Money Laundering in West Africa (GIABA) reviewed and provided input in the document. The GIABA is responsible for facilitating the adoption and implementation of Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) in West Africa. Co-funded by the European Union © OECD 2018. This work is published under the responsibility of the Secretary-General of the OECD. The opinions expressed and arguments employed herein do not necessarily reflect the official views of OECD member countries. This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. Table of Contents List of abbreviations ................................................................................................................................................... 4 Foreword .................................................................................................................................................................... 5 Executive summary .................................................................................................................................................... 6 An overview of gold mining in the region .............................................................................................................. 10 Risks within the meaning of Annex II of the OECD Guidance ............................................................................... 21 Serious abuses associated with the extraction, transport or trade of minerals .............................................. 21 Direct or indirect support to non-state armed groups ..................................................................................... 23 Direct support .................................................................................................................................................. 25 Direct control of gold mining sites ............................................................................................................... 25 Indirect support ................................................................................................................................................ 26 Abductions, ransoms and protection demands targeting industrial operators ........................................... 26 Extortion demands targeting ASM operators .............................................................................................. 27 Public or private security forces ....................................................................................................................... 27 Involvement of public or private security forces in mining ......................................................................... 27 Extortion targeting gold-mining operators .................................................................................................. 28 Bribery, fraudulent misrepresentation, money laundering and non-payment of tax ..................................... 28 Bribery, false declaration and non-payment of tax ..................................................................................... 28 Money laundering ........................................................................................................................................ 30 Conclusions and recommendations ....................................................................................................................... 33 1. Promote, circulate and implement the OECD Guidance ..................................................................... 33 2. Continue and strengthen action to support the formalisation of ASM .............................................. 37 3. Develop a regional approach to the ASM sector ................................................................................ 42 4. Incorporate considerations relating to the formalisation of ASM into regional security strategies 43 Summary of recommendations .............................................................................................................................. 45 References ............................................................................................................................................................... 51 Annexes ................................................................................................................................................................... 58 Annex 1: Notes on methodology ...................................................................................................................... 58 Annex 2: Gold production areas in Burkina Faso, Niger and Mali .................................................................... 60 Annex 3: Cross-comparison of gold flows ........................................................................................................ 63 Annex 4: Area of operation of the main terrorist groups ................................................................................ 67 3 List of abbreviations AFEMIN Malian Association of Women Miners (Mali) ANEEMAS National Agency for the Supervision of Artisanal and Semi-mechanised Mining (Burkina Faso) AQIM Al Qaeda in the Islamic Maghreb ARM Alliance for Responsible Mining ASM Artisanal and Small-scale Mining BCEAO Central Bank of West African States BNAF National Gold Anti-Fraud Brigade (Burkina Faso) CENTIF National Financial Intelligence Unit CONAPEM National Corporation of Small-scale Miners (Burkina Faso) CSO Civil Society Organisation(s) EITI Extractive Industries Transparency Initiative EU European Union FATF Financial Action Task Force FCFA Franc of the Financial Community in Africa FEMIMA Malian Federation of Women Miners (Mali) FNOM National Federation of Malian Gold Miners (Mali) GSIM Jama'a Nusrat ul-Islam wa al-Muslimin / Group for the Support of Islam and Muslims (terrorist group) INSD National Institute of Statistics and Demography (Burkina Faso) ISGS Islamic State in the Greater Sahara (terrorist group) iTSCi ITRI Tin Supply Chain Initiative LBMA London Bullion Market Association LGA Liptako–Gourma Authority MINUSMA United Nations Multidimensional Integrated Stabilization Mission in Mali (Mali) OECD Organisation for Economic Co-operation and Development ONASSIM National Office for the Security of Mining Sites (Burkina Faso) SOPAMIN Société du Patrimoine des Mines du Niger (Niger) SYNORARTRAB National syndicate of artisanal and traditional gold miners of Burkina (Burkina Faso) UN United Nations UNICEF United Nations Children's Fund UNIDO United Nations Industrial Development Organization