Lack of transparency and manipulation of gold prices, coupled with the state’s monopoly in the sector, has had a negative impact on more than 500 000 artisanal and small-scale miners in Zimbabwe, undermining efforts to formalise the small scale gold mining sector, a new study on governance of resources in the country has revealed.
Prepared by the Southern Africa Resource Watch, the report titled: Artisanal Miners Robbed in Broad Daylight: Zimbabwe gold monopoly as a conduit to canalise forex and cannibalise bodies, gives an account of how state institutions have been used to serve private interests by robbing artisanal and small-scale miners of their gold in Zimbabwe.
“It is a story of how the Zimbabwe Reserve Bank siphoned billions from the economy through the exploitation of artisanal and small-scale miners. This study gives an account of how state institutions have been used to serve private interests in robbing artisanal and small-scale miners of their gold in Zimbabwe,” said South Africa Resource Watch Communications Officer, Masutane Modjadji in a press statement.
Modgadji said over the past 20 years, Zimbabwe’s economy has been on a declining trajectory, of which long before the current political and economic woes, gold and tobacco were the country’s most lucrative source of income and foreign currency.
“What was once one of Africa’s most diversified and self-sufficient economies, has imploded and the state is struggling to ensure adequate collection and management of revenue,” he said.
“The ZANU-PF led government policies have precipitated massive inflation, currency upheavals and constant energy shortages which in turn, has led to a process of de-industrialisation, GDP shrinkage, 80 per cent unemployment and a massive exodus of the country’s own residents. The lack of transparency and manipulation of gold prices aided by the state’s monopoly has had a negative impact on more than 500 000 artisanal and small-scale miners.”
Modgadji claimed the report shows how the ruling elite in cahoots with the central bank and security establishment have been sucked into illicit gold trade practices robbing artisanal miners of billions of dollars of hard-earned gold, leaving them in poverty.
“This state staged robbery is undermining attempts to formalise the artisanal and small-scale gold mining sector.”
The report states that the government survives by robbing its own citizens, by using schemes to siphon the mineral from small-scale and artisanal miners.
“These independent, ‘unofficial’ and unprotected miners constitute a very significant source of production even as the share of gold mining by South African and big western multi-nationals diminished because of the general difficulties of operating amid disintegrating infrastructure and serious energy and forex constraints,” read the report.
According to the study, in 2013, before the gold monopoly, Zimbabwe formally recorded 14 001 kilograms of gold.
Two years later (post-monopoly), the figure rose to 20 022 kilograms.
“By 2018, it reached pre-crisis levels of more than 35 042 kilograms. But this rapid turnaround in accumulated volume was not due to an increase in corporate production, efficiency by the state or fair dealing. If anything, the state deepened financial opacity and control by strategically canalising the hungry and desperate will of Zimbabwe’s artisanal miners who were the producers of such output,” reads the report.
The study highlights that the artisanal miners have few, if any rights, and exist within a system which is layered with legal contradictions and corruption.
Unlike registered mining companies, the artisanal mines cannot demand from the state and have few options “within the many-headed hydra of deprivation that encompasses their daily lives.”
“Exposed to violence, menace and coercion from other illegal actors, they are powerless to activate even the most basic fiscal-social contract between citizens and what is a politically repressive and authoritarian state,” said the study.
Last month in October, Zimbabwe Miners Federation (ZMF) president Henrietta Rushwaya was arrested at the Robert Mugabe International Airport in Harare attempting to smuggle six kilogrammes of processed gold to Dubai, which prompted speculation that there a lot of underhand dealings linked to gold mining and buying were taking place prejudicing the country of millions in revenue.
