The ASGM Sector in Africa: Lessons from China

This chapter analyses one of the fastest-growing export sectors in Africa—gold from the artisanal and small scale gold mining (ASGM) sector. It is a sector that was largely illegal in most African countries until the 1990s and has grown from virtually nothing to exports of at least 446 tonnes of gold to Dubai in 2016, a development which has helped catapult Africa into the position of the world’s largest gold producing region; a position attained in spite of the decline in large scale gold mining in South Africa. This has in turn resulted in her replacement by Ghana as the continent’s largest gold producer in 2018. Despite the legalisation of the ASGM sector across Africa in the 1990s, the vast majority of those who operate in it do so illegally and based on recent estimates, some 80% of all ASGM in Africa remains illegal. The decision of some 10 million Africans to enter these often hazardous mines is a product of economic desperation facilitated by a high gold price, making the extraction of what are often, but not always, low-grade gold ore a commercially viable option, given the almost complete absence of alternative remunerative employment in either agriculture or manufacturing. Despite four decades of research on ASM in general and ASGM in particular there have been very few quantitative estimates of the value of poverty alleviation provided by the sector to Africa. This chapter therefore goes further to make some poverty alleviation estimates before some recommendations based on China’s experience which provides possibly the most effective example of consolidation of the ASM sector available to the external observer.