Artisanal, Small-Scale Miners Struggling to Formalize Activities

In several of Uganda’s mineral-rich areas, artisanal and small-scale miners (ASMs) are confronting significant challenges related to survival and legality. Despite the government’s acknowledgment of Artisanal mining as a legitimate livelihood, many miners are trapped in a cycle of informality, which hampers their potential for economic growth and stability.

According to various reports, artisanal miners are vital to Uganda's economy, contributing over 80 percent of the country’s Development Minerals. Additional data indicates that artisanal methods account for more than 90 percent of the country's total gold production.

Emmanuel Kibirige, the national coordinator for the Uganda Association of Artisanal and Small-Scale Miners-UGAASM, said that currently there is a disconnect between the miners' realities and the regulatory framework, which creates a disincentive for those seeking to formalize their activities.

"For many, the economic benefits of staying informal outweigh the advantages of compliance," Kibirige stated. "Although changes in regulations have prompted many artisanal miners to try and formalize their operations, they are often hindered by red tape and a lack of information. The process of formalization is incredibly challenging, and many miners continue to operate as they always have because they haven't been able to adapt."

Kibirige expressed gratitude that the legal regime now recognizes ASMs, which is a significant shift from past struggles for acknowledgment. However, he notes that while progress has been made, the situation remains daunting for many miners.

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Kibirige further noted that the current process appears to be completely detached from the past. In his view, while efforts to formalize activities are important, those in charge should take into account how things have evolved from a time when miners operated freely to the present, where they have made significant efforts to comply with various regulations over time. He emphasized the need for authorities to understand this transition and the challenges faced by miners as they adapt to new requirements.

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In 2022, the government enacted the Mining and Minerals Law to among other things integrate ASMs into a regulatory framework, by introducing crucial provisions for responsible mining practices, health and safety regulations, gender equality, and environmental protection. Yet the law has not yet led to tangible improvements for miners on the ground.

For instance, the new law includes various licenses available to artisanal and small-scale miners. Among these is the Artisan License, which requires an application fee of one million shillings, along with annual rent fees of one million. Similarly, the Small-Scale Miner License also has a one-million-shilling application fee.

Given that many artisans are running businesses worth millions, one might wonder why they are struggling to obtain licenses. Kibirige said that the issue is more complicated than it appears. He explained that while the licenses have relatively low formal fees, they come with numerous requirements that are challenging to fulfill. 

For instance, to apply, artisan miners must provide documentation such as proof of land ownership, an environmental impact assessment report, URSB forms, tax compliance, and other tangled web of paperwork. "Obtaining the required land ownership documents and environmental impact assessment reports is extremely expensive. Additionally, the process is time-consuming, with forms being passed from one place to another, and many artisans simply don't have the time for that. Moreover, all of this comes with significant costs to fulfill," he explained.

He added that, under the new law, the government’s establishment of artisanal exclusive zones could be helpful. These zones could streamline the process by conducting the EIA reports themselves and only requiring miners to adhere to the recommendations.

Rose Nakawuma, the Artisanal and Small Scale Mining Associations and Co-operatives Officer at Planet GOLD Uganda, also highlighted that the new legal regime is unfriendly to artisanal miners, citing the numerous and costly requirements it places on them. In addition to the financial and bureaucratic hurdles, Nakawuma pointed out that the licenses are excessively restrictive.

She noted, for example, that the artisanal mining license limits miners to a depth of just 10 meters underground, which significantly hinders their ability to access deeper gold deposits. She argued that with such provisions the is effectively designed to drive artisanal miners out of business, making it increasingly difficult for them to operate both legally and sustainably.

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Under the previous mining regime, a location license was all that was required to begin mining operations. One would simply apply for the license, obtain it, and then start mining. There was no red tape in the process.

However, Emmanuel Kibirige acknowledged that while the law has significant gaps, it is still a positive step forward. He expressed confidence that over time, these gaps will be addressed, but emphasized that miners have chosen to follow the current procedures and later engage with the authorities to address concerns.

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Our reporter visited the Kassanda gold mining areas, where most of the miners are still engaging in illegal mining activities. Many of them are operating under exploration and location licenses granted to them under the previous legal regime.

Amina Kiiza, a mining engineer and inspector in charge of the central region at the Directorate of Geological Survey and Mines explained that the ministry is currently working to educate miners on how they can legalize their operations. 

During a meeting with the miners, she walked them through the process, detailing the various licenses they can obtain and the additional requirements they must meet. "We (referring to miners) have long been operating illegally, without licenses. But in recent years, the government has begun formalizing and improving the sector, including licensing requirements and biometric registration. We must embrace these changes if we are to benefit and continue earning from this sector," Kiiza told the gathered miners.

Throughout her speech, many of the artisans viewed her explanations as unattainable. "The only problem is that all these things apply only to the Kampala office, not to us here in the mines," one attendee murmured.

As a way to overcome the red tape for individual miners, artisans in Kassanda, through their various associations, are attempting to apply for licenses as a group. For example, the Mubende United Miners Association, operating on Kagaba Hills in Kassanda, has applied for a small-scale mining license.

As MUMA works towards securing a small-scale mining license, they have managed to get clearance and signed agreements with close to 90 percent of the landowners within the 1-square-mile area they plan to operate in. This was done in exchange for 10 percent of their proceeds. Additionally, they have received the terms of reference for the Environmental Impact Assessment from NEMA and will soon hire an environmental consultant.

However, in many other mines scattered around the Kassanda-Mubende area, the sector remains shrouded in illegality. They are currently facing exploitation by mineral police, ministry officials, and other authorities, who are demanding bribes or blocking their efforts to operate.

Joshua Rukundo, a senior project officer at Solidaridad East and Central, an organization that has been helping in the formalization process looks back to the old mining regime. He said the Mining Act of 2003 didn’t have any words like artisanal or small scale, so even the type of license that was there was just cosmetic and hard to achieve.

“At some point almost everyone that had that license was operating illegally because the location license had an equivalence of 10 million, now on a mine site if you have to do an open cast mines where you hire an excavator for 1.5 million a day, if you add fuel and operators costs, already within two days, you will have exhausted the investment you should use for that license and you you’re going to operate illegally for the rest of the year.”

He also added that while the new law is restrictive for miners, it at least recognizes them. However, he emphasized that the hurdles to formalization are undeniable and glaring. He noted that the process is currently plagued by red tape and is very slow, particularly regarding the government's handling of the licensing issue and the unclear transition for miners holding old location licenses to obtain new ones under the updated law.

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He further mentioned that to accelerate the formalization process, there is a need to decentralize certain procedures, reduce bureaucratic red tape, and increase staff at the Directorate of Geological Survey and Mines (DGSM), which is responsible for handling and inspecting mines. Currently, the entire central region has only one mine inspector.

As the government perceives miners as not fully prepared for the requirements of the new law, Rukundo observed that the government itself must also undertake substantial groundwork if the new law is to be successfully implemented.

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According to statistics from Planet Gold, the ASM sector in Uganda employs an estimated 400,000 to 600,000 men and women, with around 31,600 of them specifically focused on gold mining. This workforce is not just a statistic; it represents the livelihoods of families and entire communities. The ASM sector also indirectly supports an estimated 2 million people, making it a vital pillar of Uganda's economy.