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Documenting planetGOLD programme experiences with ASGM supply chain mechanisms

Documenting planetGOLD programme experiences with ASGM supply chain mechanisms

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  • Artisanal and small-scale gold mining (ASGM) plays a pivotal role in driving local economies and supporting livelihoods globally. However, its predominantly informal nature, regulatory constraints, financial limitations, and difficulties in meeting compliance standards all present challenges for miners to access formal markets.
  • The planetGOLD programme, working in partnerships with governments, the private sector and ASGM communities aims at addressing these challenges and improving production practices and the work environment for ASGM miners. This includes working to close the financial gap, supporting formalization, raising awareness, and connecting miners to mercury-free technology and formal markets.
  • Through the implementation of the planetGOLD Criteria for Environmentally and Socially Responsible Operations, ASGM stakeholders are able to showcase adherence to internationally recognized responsible sourcing standards.
  • This report assesses the efficacy of planetGOLD ASGM supply chain mechanisms, focusing on experiences from country projects funded during the program's first phase, with the objective of distilling key insights for similar ASGM market access initiatives.

The planetGOLD country projects have strategically used various approaches to integrate ASGM actors into formal gold markets, considering the multifaceted challenges of the sector’s informal nature and the diverse economic landscapes in which ASGM operates. Recognizing the broader context of ASGM supply chains, ASGM market access initiatives focus on creating sustainable linkages between ASGM organizations (ASMOs) and formal buyers. Given the prevalence of informality in ASGM operations, efforts extend beyond mere formalization to encompass the application of good organizational and mining practices. Challenges related to informality, such as limited access to formal financing and trading systems, necessitate collaborative efforts with governmental authorities to strengthen legal frameworks and regulations. Moreover, geographic remoteness and centralized gold buying centers pose logistical hurdles, reinforcing reliance on local traders and highlighting the importance of financial services in enabling miners to adopt responsible practices.

The planetGOLD programme's approach to facilitating market access is integrated within its wider framework to support cleaner, safer, and more efficient ASGM practices. Country projects implement various activities under the “access to formal markets” pillar of the programme, including conducting supply chain studies, providing training on the planetGOLD Criteria, and assisting ASGM organizations (ASMOs) in preparing documentation to demonstrate compliance. Activities to facilitate engagement with market actors, pilot supply chain mechanisms, advocate with governments for better regulations, and address logistical barriers were also implemented by some planetGOLD country projects. In addition, initiatives to support access to finance and the formalization of ASMOs have a complementary and pivotal role to close the gap between miners and formal market participation, ensuring sustainable economic linkages within the ASGM sector.

The analysis found that the planetGOLD country projects face several challenges in fulfilling the programme’s objective of increasing miners’ access to formal markets. The majority of these challenges are deeply rooted in systemic issues and proved, in many instances, too complex to resolve within the scope of the countries’ projects. These barriers include difficulties in formalizing ASGM operations, which can restrict miners’ access to formal market and compelling them to operate outside formal channels. Furthermore, continued difficulties for ASGM operators’ to access formal financing, partially due to negative perceptions of the ASGM sector that persist at banks, perpetuate miners’ reliance on pre-financing arrangements with informal traders or collectors, which in turn has created dependencies that complicate their transition to formal buyers. Other key challenges identified included weak regulatory enforcement and support, difficulties in translating due diligence requirements and benefits to miners and traders as well as in documenting compliance with those requirements, ensuring traceability of ASM gold, and a lack of trust among ASGM supply chain actors. In addition, leveraging compliance with the Criteria into concrete and self-sustaining market linkages has also proven difficult. Focus on compliance alone does not result in transition to formal supply chains but requires specific interventions to support formal market actors’ engagement, commercially viable and sustainable market linkages. Geographic remoteness, existing relations with informal traders, logistical trade challenges related to location and accessibility, and gender barriers further complicated the ability of the planetGOLD country projects to facilitate formal market linkages.

Through this assessment and the authors' broader expertise in facilitating market linkages, several key lessons were distilled. Emphasizing a multifaceted approach to overcoming barriers to formal market access, this report underscores the importance for ASGM market access initiatives, including activities under the planetGOLD programme to be designed and implemented on the basis of a supply chain mapping study to better understand the role of local trade dynamics in fostering sustainable market linkages. Furthermore, identifying incentives for ASGM actors to engage with formal markets emerges as a fundamental element, recognizing the often vastly different expectations between miners and programs regarding the benefits of formal market access. Practical solutions to logistical challenges, such as decentralizing essential services and engaging local intermediaries, are also explored, with promising results in several country projects. Moreover, the engagement of market actors beyond miners in ASGM market access initiatives, in particular local traders and downstream market actors, is identified as crucial to ensure market linkages will sustain beyond the life of the project.

This report also includes the analysis of the 9 planetGOLD phase 1 countries. These were central to the outcomes outlined in the four main chapters and to identify common challenges and lessons learned. Each annex then provides further details on the activities, challenges and lessons that each country experienced based on their specific context and level of advancement against programme’s objectives.

 

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