Artisanal and Small-Scale Mining (ASM) in Africa and the Supply of Critical Raw Materials CRM to European Markets

This paper revisits the challenges and opportunities artisanal and small-scale mining (ASM) may pose for an evolving supply-web for mineral raw materials seen as critical for the EU. Artisanal and small-scale mining operations are often associated with poor operational health & safety (OHS), lasting environmental impacts, and poor governance, if not criminality. ASM is also characterised by a high degree of externalisation of environmental and social costs and risks due to its largely opportunistic nature. To the contrary, one of the overarching policy-goals of the EU is to ensure a fair, responsible, sustainable and sustained supply of critical raw materials. A wide variety of minerals have attained economic importance only in recent years, but are not found in economic quantities in Europe. The globally increasing demand for them means that not only precious metal, diamonds and gem-stones are of interest to ASM anymore, but also the less rich fringes of occurrences mined by large-scale mining (LSM) companies. Thus, we can expect to see more ASM mined critical raw materials in the EU supply-webs.

In order to not leave such mine products to less scrupulous competitors on the market, EU downstream actors and policy-makers have to consider how to align ASM with our environmental, social and governance (ESG) expectations while recognising the motivations of people for engaging in ASM activities. An extensive review of the literature on ASM in Africa in particular and of relevant aid and donor programmes has been undertaken to better understand motivations, constraints and ‘business models’ used with a view to reduce their degree of externalisation of costs and risks.

Key findings include: a) Formalisation of ASM should be seen as an end goal rather than a starting point, b) Acknowledging that ASM is a subsistence activity that does not fit into the business development philosophy of traditional money lenders and donor agencies, c) Sustainable ASM business models require real and sustained economic incentives aligned with ESG improvements, an d) Re-thinking of risk assessment and management by traditional money-lenders and training of ASM to better understand their concerns and constraints, as lack of funding is a major constraint.

Three ‘business models’ seem to be most promising strategies to integrate ASM activities into the EU value-webs while maintaining our ESG expectations: a) Fostering symbioses between LSM and ASM with a view to constructive collaboration, b) Fostering the association of ASM operators to increase collective bargaining power and collective improvement, and c) Building up of mineral raw materials clusters that covers more elements of the value-webs and associated economic activities, including the construction of supporting infrastructure.