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Gold Mining as Subsistence: Ghana's Small-Scale Miners Left Behind

Touted as having as much as 70 percent of West Africa’s gold deposits, Ghana has, for centuries, attracted numerous foreigners seeking to trade and invest in its mineral riches. About one-sixth of the country contains extractable gold, and certain regions hold rich diamond reserves. So even though the face of foreign investment has shifted dramatically in Ghana’s gold-mining industry since the establishment of the Gold Coast Colony in 1874, thousands of indigenous people continue to rely on small-scale extraction of gold as a principal source of employment.

In the process of promoting increased foreign investment in the resident large-scale mining industry, the Ghanaian government has perpetually worsened the livelihoods of many of the country’s rural inhabitants. About 25 percent of the western part of the country contains extractable gold deposits (see map) and certain regions hold rich diamond reserves. By giving preferential treatment to foreign international mining corporations in the past 10 to 15 years, the government has dramatically disrupted the lives of thousands of indigenous small-scale miners.
A Corporate Goldmine

With Ghana’s economy stagnating in the late 1970s, both the International Monetary Fund (IMF) and World Bank intervened, helping to draft a series of policies to improve economic conditions; thus, an ambitious Economic Recovery Plan (ERP) was launched in the early 1980s. Some 20 years later, the ERP has failed to yield the desired results. Ghana has diligently pursued virtually all of the recommendations put forth by the IMF and the World Bank, and, as a result, is faced with a plethora of new and equally unmanageable problems.

Since the ERP policy’s launch, hundreds of mining and mineral exploration companies with headquarters in Australia, Canada, and the United States have successfully secured licenses to prospect for gold and/or excavate ore in Ghana. The World Bank and IMF argue that their bragging rights lie in the mass increases in operating mines and gold production that have occurred in the past 20 years. Annual gold production has increased almost eight-fold since 1983, and has long surpassed cocoa as the country’s chief economic resource. The benefits the government has received from this “success,” however, have paled in comparison to those received by the companies.
Government Mismanagement

The most serious problem imposed by heightened large-scale mine investment and a problem that continues to be ignored by the Ghanaian government is the mass dislocation of indigenous small-scale miners and galamsey—a label given to the resident "illegal" small-scale mining segment. The government completely legalized small-scale gold mining in 1989 in a reactionary move after realizing that as much as 20 percent of gold output was being lost through unmonitored small-scale mining channels. But the operating climate has been as unattractive for small-scale miners as it has been favorable for large-scale miners.

The efforts taken to draft and implement laws and registration procedures for small mines have been exceedingly cavalier. Problems begin with the procedures required to secure a license to mine on a small scale, and the inherent delays associated with the application paperwork and countless evaluations pose a considerable problem to the subsistence small-scale miner. A small-scale miner relies on daily gold output in order to provide food and shelter for his family; thus, the longer he is unlicensed, the more difficult his poverty-stricken life becomes. When the government is asked why so many delays are involved with securing a small-scale mining license in almost all cases, officials almost always indicate that during the time the paperwork is being evaluated, a miner is granted tentative permission to mine allocated lands. Why, then, the need for so much paperwork and countless evaluations?

Government officers in the capital city of Accra indicate in their written and personal communications that they believe most of the galamsey mining sector are illiterate and content with maintaining their patterns of migratory "hit and miss" gold mining activity. Interestingly, small-scale miners appear to be doing the exact opposite. Numerous galamsey explained during individual interviews that manual production techniques, which the government labels as the most disorganized and rudimentary of the country's mining industry, are insufficient to sustain the livelihoods of the typical small-scale miner and his family. In turn, a number of miners have borrowed funds from gold-buying agents for the sole purpose of purchasing machinery capable of facilitating increased gold production. As one galamsey miner in Bibiani explained:
Most of our mining techniques are manual, so they cannot generate enough money to open up the [gold mine] works … but if there is money to come, we could progress to semi-mechanic by purchasing pumps and washing machines so production would increase. … Then we could purchase more equipment and hire more hands. Even when miners manage to secure a license to mine on a small scale, they frequently get the short end of the stick. For example, one gold miner in Bibiani who had successfully secured a license to mine adjacent to the local Ashanti Gold Fields (AGC) mine was declined for a renewal following expiration of his license. AGC suddenly became interested in surrounding small-scale workings, and thus pushed for acquisition.

In a personal interview, the miner explained:
AGC absorbed all of the small-scale mining plots when the small-scale mining licenses came up for renewal … the government has the right to renew, and they decided not to do so. My land was acquired in 1996, and at the time, they [AGC] were supposed to bargain and buy us out, but as our licenses expired, there was no need … the only compensation I received from AGC was a small petrol water pump, which has long since broken down. … In July 1997, the three or four small-scale mining concessions surrounding AGC's property, one of which was owned by myself, were officially secured by AGC through the Minerals Commission. I was even getting investment interest at the time from the American Wiesenski Investment Group, which received word from the Minerals Commission that I was a legitimate small-scale gold miner … but as I was soon forced off the land, I had no legal means of obtaining gold for this company.

Similar kinds of cases are reported almost daily in Tarkwa, Obuasi, Dunkwa, Prestea, and Dumasi—Ghana's most important gold mining regions.

The careless approach of the government—namely, the Minerals Commission—has been responsible for intensifying land competition between small- and large-scale gold miners. In an overwhelming majority of cases, significant portions of the awarded concession are not amenable to large-scale mining and prove ideally suitable for small-scale mining; as a result, mineable land is taken out of the hands of a considerable number of small-scale miners. Ghanaian law prohibits registering a small miner on a large-scale mining concession, and extracting portions of land awarded to a large-scale mining company can be a challenge of monumental proportions. The score of ensuing problems are clearly a result of the Minerals Commission not doing its homework. The government is doing little to assist its small-scale miners. The intricate government partnership forged at the start of the Small-Scale Mining Project in 1989 divided industry responsibilities between the Geological Survey Department, Minerals Commission, Precious Minerals and Marketing Corporation (PMMC), and Mines Department. These partnerships, however, have long since dissolved. The Minerals Commission has been burdened with the majority of responsibilities related to small-scale mining, with PMMC serving as the monopolistic purchaser of gold from small-scale miners. Despite its claims of having established district support centers in the field for small-scale miners, the Minerals Commission has provided little hands-on assistance overall. District support centers are poorly resourced, most lacking adequate telephone and computer services and appropriate staff. The government rarely provides the money, information, and training facilities needed; thus, its claim of having decentralized the support scheme for small-scale miners is highly misleading.

In the majority of cases, the government does not prospect land to determine ore grades and gold abundance before awarding it as concessions to small-scale miners. The miner therefore relies on local sources of information for determining appropriate locations for gold mines. In addition, following approval of the license, the miners frequently discover important communities, schools, and offices in close proximity to operating mines, in some cases causing disruption to the communities.
Corrupt Purchasers

Consider, also, the corruption plaguing the gold-purchasing system. PMMC now has some 800 buying agents in the field purchasing gold and diamonds from both the illegal and legal small-scale mining channels. The move was deemed crucial to minimizing the illicit marketing and smuggling of minerals, and has created extremely favorable results. Since 1989, PMMC buyers have collected over US$300 million worth of gold from resident artisan and small-scale gold miners. Between 1989 and 1994 alone, 30,000 small-scale miners reportedly produced and sold to governmental offices some US$68.56 million in gold and US$71.5 million in diamonds. However, the system places most of the responsibility in the hands of the gold buyers who, according to two artisan miners in Bibiani, are "corrupt, unfair, and a bunch of crooks." The biggest victims are the residents of small-scale mining villages, many of which are situated well out of reach of major towns. Residents are frequently quoted a "bush price" for gold by buyers that, in some cases, amounts to less than 80 percent of the market price for gold. The buyer then sells the product to PMMC for a substantial profit.

These issues have caused conflicts between large-scale mine management and small-scale miners that have intensified in recent years in many areas, where clashes have resulted in millions of dollars worth of damage, numerous injuries, and occasional fatalities. In Tarkwa and Bibiani, however, conflicts have lessened in the past year because large-scale mine management became disinterested in particular portions of their concessions that were no longer suitable for large-scale mining.

It is time for the international community to come to the aid of Ghanaian small-scale miners and begin pressuring the government to promote the sector effectively and meet the needs of its participants. The justification for this support lies in small-scale mining being a far-from-typical subsistence industry. Consider its contribution to Ghana's economy. Excluding Ashanti Goldfields' Obuasi mine, which accounts for over 50 percent of Ghana's gold production, small-scale gold miners and galamsey produce between 15 percent and 20 percent of the country's gold. According to unofficial statistics at the Minerals Commission, an estimated 145,662 ounces of gold was collected from small-scale miners in 2000 alone. Since the industry was legalized, production has increased between 20 percent and 150 percent each year; production today is almost 15-fold that of 1989. More importantly, small-scale gold mining makes more of a direct contribution to foreign exchange and export earnings than large-scale mines. Small-scale miners and galamsey are concerned only with receiving adequate payments for gold in Ghanaian Cedi currency, and unlike their large-scale counterparts, they do not demand U.S. dollars for mined products or export for sale.
Government in the Field

For small-scale mining to be promoted effectively, however, the perception of the industry needs to change considerably, particularly at the national government level. Regionally, marked differences in opinion exist among small-scale miners. In the mining regions themselves, both district mining officers and mines wardens are working diligently with few resources to improve the livelihoods of small-scale miners. In fact, small-scale miners have developed such a positive rapport with government workers in the field that most miners consider them more as support staff than as government officials. One miner in Tarkwa, referring to both the local district officer and mines warden, explained: "My friends here help me with the paperwork that I send to the government, and help me comply with the procedures and laws they set for us." The government representatives working in close co-operation with small-scale miners actually sympathize with the miners' cause, and are therefore keen on helping them in any possible way. In Accra during 2001 and 2002, however, various government officials labeled small-scale miners as "a grievance," "annoying," and "unimportant," and referred to the industry as being in a "highly unmanageable state." Moreover, the Ghana Chamber of Mines, the national body of the Ghanaian mining industry, has frequently issued press releases describing, among other things, "the menace galamsey."

The Ghanaian government, along with a number of centralized institutions, present a negative portrayal of the country's small-scale miners. Only when one visits prospective small-scale gold mining regions do they realize how the government, through the promotion of large-scale mine development, has disrupted the livelihoods of thousands of the country's rural inhabitants. Until policies are amended, and more decentralized services are provided to galamsey, land-use competition will continue to intensify between resident small- and large-scale mining parties.
Recognizing Small Miners

The Ghanaian government's preferred agenda for mining is clear: eradicate the galamsey, and promote the expansion of large-scale mine development. Government officials largely unacquainted with the on-the-ground realities of the mining sector continue to praise the developments achieved by implementation of the IMF and World Bank policies, which clearly do not recognize that small-scale mining is the third most significant contributor of gold to the national economy. Bureaucrats in Accra repeatedly ignore small-scale miners' requests for assistance, and large-scale mining companies continue to take the land that supports their livelihoods. Yet, despite continually being mistreated, receiving insufficient support from the government, and repeatedly having their demands ignored, the majority of Ghana's small-scale gold miners would be satisfied if the government would only free the small parcels of land not used by large-scale mining companies. The galamsey see this more hands-on assistance as the only solution because it would give them the opportunity to share their views one-on-one with the government, which has basically given up and determined that the galamsey situation is irresolvable.
Gavin M. Hilson is a member of the Environmental Policy and Management Group (EPMG), Imperial College of Science, Technology and Medicine, Royal School of Mines. His current research interest is environmental management in the small-scale mining industry. He is currently undertaking research in Ghana.
References and further reading
Aryee, B.N.A., Ntibrey, B., Atorkui, E. 2003. Trends in the small-scale mining of precious minerals in Ghana: a perspective on its environmental impact. Journal of Cleaner Production 11(2): 131-140.
Hilson, G. 2002. The environmental impact of small-scale gold mining in Ghana: identifying problems and possible solutions. Geographical Journal 167(1): 57-72.

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