Mining & Trade News

Despite the Reserve Bank of Malawi (RBM) operating the structured market for gold and gemstones for years now through its subsidiary Export Development Fund (EDF), Artisanal and Small-scale Miners (ASMs) dealing in these minerals say they are continuing to experience a host of challenges in finding a formal market for their minerals.

Chairperson of ASMs in Malawi who is also President of the Federation of Women and Youth in Mining (FWYM) Flore-Annie Kamanga said in an interview that the problem emanates from lack of licensed buyers as EDF officers are not available to buy the minerals in all mining areas, difficulties in obtaining export permits, and a lack of knowledge about pricing mechanisms and value addition.

Kamanga said: “Small-scale miners primarily sell their minerals through informal channels due to limited access to formal markets. This forces the miners to deal with middlemen who offer very low prices.”

“There are also difficulties in obtaining export permits leading to smuggling, and limited knowledge of pricing mechanisms and value addition, which results in miners being exploited.”

Kamanga also pointed out that RBM’s verification standards require documentation that many miners lack such as proof of legal mining and official export licenses.

“The costs associated with meeting verification standards are too high for most artisanal miners. There is also limited awareness and technical knowledge on how to comply, and bureaucratic delays in obtaining necessary approvals make compliance unachievable.”

However, Kamanga believes that mining cooperatives can offer a viable solution to the problems.

“Forming cooperatives can be a game changer as through the cooperatives, ASMs can pool resources together to afford legal compliance costs, strengthen miners’ bargaining power to negotiate better prices, facilitate training on verification processes, and enable direct engagement with regulatory bodies like RBM.”

She, however, said the cooperatives will require adequate support to be effective including provision of access to affordable loans or grants to cover compliance costs. They will also need technical support including training on mineral valuation, record keeping, and proper mining practices.

“The government must also facilitate direct sales to licensed buyers and streamline the verification process to make compliance more accessible,” Kamanga said.

Kamanga observed that mining cooperatives have already helped many miners formalize their operations and secure mining licenses.

“They provide financial assistance for compliance-related expenses and offer collective support in meeting government regulations, including RBM verification standards. However, their success depends on strong leadership, proper governance, and government support.”

Meanwhile, RBM is seeking independent assessors for gold and gemstones. The Bank says the assessors will assess the authenticity of the purchased minerals, weight.

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