Are Alternative Livelihood Projects Alleviating Poverty in Mining Communities? Experiences from Ghana

Abstract

This paper critiques the approach being taken in Ghana to implement Alternative Livelihood (AL) projects in mining communities. The rapid insurgence of illegal artisanal gold mining has forced policymakers to think more creatively about ways in which to deal with mounting unemployment in the country's rural areas. Most of the economic activities being promoted, however, have proved highly unpopular with target groups. The adopted policy approaches reflect how little in tune the organisations championing AL activities are with the mindsets and ambitions of rural populations.

Acknowledgements

The authors would like to thank James Haselip and two anonymous reviewers for their constructive criticisms on a previous draft of this paper. The authors would also like to thank Mike Hilson for his assistance with the diagrams. Financial support for this research was provided by the Nuffield Foundation (SGS 32025), and the Research Support Fund, School of Environment and Development, University of Manchester. Needless to say, any errors this article may contain are the sole responsibility of the authors.

Notes

1. Throughout this paper, ‘artisanal mining’ and ‘small-scale mining’ are used interchangeably.

2. Consensus on these definitions was reached at DfID's Natural Resources Adviser's Conference on Sustainable Livelihoods.

3. As Hilson and Nyame (2006) explain, by law, of the 3 per cent royalty payment mining companies are required to pay (3% of the gross value of minerals extracted), 80 per cent belongs to the central government, with the remaining 20 per cent deposited into the Mineral Development Fund. Half of these monies are given to mining agencies and the other half to the Office of the Administrator of Stool Lands, which retains 10 per cent, and allocates the remaining 90 per cent to the following authorities for community development purposes: (1) district assemblies (55%); (2) traditional authorities (20%); and (3) the stools of mining areas (25%).

4. For example, in Noyem there are people working as diggers, ore washers, haulers, security officers and drivers. There are also regular ‘taxi runs’ from mining camps to the nearby towns of Nkawkaw and New Abirem, as well as thousands of women at work in local markets, selling everything from ore sacks, to replacement machinery parts, to marijuana and local liquors.

5. As explained by Hinton (2005), ‘lured by the possibility of “hitting it rich”’ (CASM, 2005: 19), an increasing number of people are moving from townships and urban areas to rural regions to engage in artisanal mining: in effect, the sector is fuelling urban-rural migration.

6. The grass-cutter (Thryonomys swinderianus) is a rodent of the suborder Hystricomorpha, whose natural habitat is the tall grassland of the Guinea Savannah.

7. It may appear that prospecting and exploration companies do not hold on to parcels of land for significant periods of time. Yet, combined, the reconnaissance and exploration phase can span 10–15 years (see www.ghanamining.org). A reconnaissance license permits the holder to search for minerals using geochemical and photo-geological means. This license can be renewed for up to one year, although the Minister can intervene to grant a company a longer lease. A prospecting (exploration) license grants the holder the right to conduct geological/geophysical investigations within a designated area not exceeding 150 km² for a period of three years. The license can be renewed for up to two terms (of up to two years each). A mining lease gives the holder the right to mine and process minerals within an area not exceeding 50 km² in the case of gold for a period of 30 years, subject to renewal for another 30 year term.

8. Data obtained from: www.ghanadistricts.com

9. Data obtained from: www.ghanadistricts.com

10. Data extracted from: http://www.ghanadistricts.com/districts/?news&r=4&_=68&PHPSESSID=b639c72f8e9a2062562df0396e83da40 and the Ghana Statistical Service (Ghana Statistical Service, 2002).

11. Data extracted from: http://www.ghanadistricts.com/districts/?news&r=4&_=68&PHPSESSID=b639c72f8e9a2062562df0396e83da40

12. Accessed at: http://www.ghanadistricts.com/news/?read=4553&PHPSESSID=bae13857fd2bc057a7ae001bfba14b44

13. In total, 10 mining company officials, 15 galamsey heads/elders, eight government officers and employees from five NGOs were interviewed.

14. OICI is currently managing the following three mining-livelihoods projects in Ghana: for Newmont Ghana, the Livelihood Enhancement and Community Empowerment Programme; for AngloGold Ashanti, the Ghana AngloGold Ashanti Hand-to-Hand Community Development Programme; and for Gold Fields Ghana, the Sustainable Community Empowerment and Economic Development Programme.

15. A recent incident in Burkina Faso, however, does suggest that OICI is at least partly responsible. Searching for an outfit to provide advice on how to re-skill thousands of artisanal miners at its Essakane site in Northern Burkina, Gold Fields called upon OICI to deliver a presentation. The powerpoint presentation given, however, had a ‘Newmont’ logo on each slide: the same presentation had clearly been delivered to Newmont in Ghana at an earlier date. Essentially, the same solutions were being prescribed for two different environments.

16. Wassa West farmers to begin Silk Farming, Accra Daily Mail, 20 April 2004.

17. Officers at the Ghana Chamber of Mines continue to praise BGL's Alternative Livelihood Project. When asked about the effectiveness of the AL projects implemented countrywide, one senior officer responded: ‘I would be surprised if none are not working’.

18. Families have been promised the following incomes: US$624 in the second year; US$1248 in the third year; US$1796 in the fourth year; and US$1952 in the fifth year. These sums do not take into account inflation.

19. There are approximately 9000 cedis in one US dollar (conversion rate as of September 2006).

20. Accessed at: http://www.doingbusiness.org/ExploreEconomies/Default.aspx?economyid=76

21. The decision to farm tilapia is something which mining company officials have decided on their own, without any significant market analysis. In the case of BGL, the company itself coordinated a tilapia market study in Prestea and Bogoso, the results of which are unavailable to the public. The exercise, however, was likely far from comprehensive: the company has very poor relations with surrounding communities.

22. This is not to say that a new market cannot be created. This discussion is merely questioning the commitment of companies to expand or re-establish a rural market: there is simply not enough energy or more importantly, money, being put into the projects. There have, however, been several success stories elsewhere – in large part because a company has committed itself to establishing a market. At Yanococha in Peru, for example, the mine operator – Newmont – commissioned a seamstress to provide uniforms for the company. She then hired 300 seamstresses because by ‘piggy-backing’ on the mine, she has managed to secure a number of customer orders in Lima. Newmont was also the first customer of a local metal fabricator, who has since managed to build up a significant customer base in the region.

23. Excerpted from the article: Chamber of mines: supporting mining in Africa, Mining Review Africa, issue 6, 2004, accessed at: http://www.miningreview.com/archive/mra_6_2004/36_1.php

24. Accessed at: http://www.indexmundi.com/ghana/literacy.html