When introducing a new plant to a new ecosystem, one must consider different conditions for that plant to grow and flourish, such as light, temperature, water, humidity, and nutrition of that new environment. Much like this, adapting the planetGOLD criteria standard to the Mongolian context should take into consideration its legal environment, the historical background of artisanal and small-scale gold mining (ASGM), the cultural peculiarities or nuances, local dynamics, and the general perception of ASGM in public.
If we draw out this plant analogy further, the planetGOLD Mongolia project team serves as the gardener, and the planetGOLD criteria is the plant. We began "planting" in 2022. As gardeners, we considered the legislative framework, the history of ASGM, the cultural peculiarities or nuances, local dynamics, and public opinion on ASGM in Mongolia.
The planetGOLD Mongolia project is the first "gardener” to start actively planting the planetGOLD criteria standard on Mongolian soil, which is a branched-out version of the CRAFT Code (The Code of Risk-mitigation for Artisanal and small-scale Mining Engaging in Formal Trade), another further international standard.
Mongolia has always been a livestock-based country. Artisanal mining is not a common means of earning a living in the country. The beginning of the 21st century saw a veritable gold rush in Mongolia. The restructuring of the Mongolian state from centrally planned to market-oriented resulted in a high unemployment rate. Furthermore, when three consecutive "dzuds" — dry summers followed by harsh winters — devastated livestock between 1999 and 2002, many herders turned to artisanal mining to make ends meet. Then, when the price of gold rose sharply, a huge number of people entered the mining sector. The number of miners soon swelled to 100,000 individuals (two-thirds men and one-third women), amounting to roughly 20% of the rural workforce.1
As reported by the Mongolian government, as of September 2020, there were 262 artisanal mining areas spread across 52 villages in 16 provinces in Mongolia. Of these approved ASM areas, 74% are designated for gold, 25% for fluorspar, and 1% for tungsten mining operations. Since artisanal mining is rather new to the country, the planetGOLD project understood that implementing and adapting a standard would also be new and ‘foreign’.
So, what is the planetGOLD criteria/CRAFT Code? The planetGOLD Programme sets out specific criteria to govern the operations of ASGM entities engaged with the programme. Conformance with the criteria will ensure that artisanal and small-scale miners participating in the programme undertake sufficient efforts to avoid, minimize, mitigate, and where appropriate, offset adverse impacts posed to people and the environment. In addition, by adhering to these criteria, mining entities will enhance their ability to attract financing and sell their gold products to formal markets.
More about planetGOLD criteria to be found here:
How the journey started:
In July 2022 when the project started the implementation of the criteria, an initial assessment was conducted to identify where the organizations needed improvement, or already complied with the standard. The results showed that most of the miners have not heard about the CRAFT Code before. The legal environment in Mongolia was also a challenging environment for implementation because the main ASM regulation was delayed and most ASGM entities were working illegally.
The project has chosen three ASGM organizations to implement the criteria: the Tunkhel Manlai partnership, the Shijir Khishig partnership, and Baatarvangiin Khishig Non-governmental Organization (NGO). All the entities are operating in Mandal sub-province of Selenge province, although all of them have their unique operating environments. The partnerships have 9-12 members each, whereas the NGO consists of over 180 members and is one of the biggest ASGM organizations in the area.
As a result of the initial assessments, the chosen organizations developed a work plan to improve their operation and comply with the criteria. The main activities indicated in the plan were to capacitate and inform the miners about the main criterion and the individual topics, such as occupational safety and health, human rights, gender issues, formalization, and so on. In addition, one of the main goals of the plan was to assist the partnerships in helping them to adapt their internal rules and documents to align with both the local legislation and the planetGOLD criteria. As one of the criteria is to appoint a CRAFT officer in charge of compliance, the mining entities chose one of their members as a CRAFT officer, who were also trained and capacitated on the topic and gained knowledge and skills to support the implementation of the criteria. Some of the CRAFT officers had to be replaced by someone with more availability during the process. While ASGM organizations faced issues of a lack of institutional memory due to this instability of positions, this enabled the entities to capacitate more than one person on this topic.
As a result of the changes to the internal rules and recording templates, the organizations are now able to refer to the core principles of the organization, which are mainly based on:
- Human rights and respecting each other,
- Adhering to the legislations of the sector,
- Refraining from using mercury and other harmful chemicals,
- Respecting women, children, and their rights,
- Always following the occupational health and safety rules,
- Respecting and protecting the environment in all the stages of mining,
- Cooperating with the community and herders nearby,
- Having an effective complaint mechanism, and
- Establishing a transparent supply chain for mining, transporting, processing, and selling of gold, etc.
Like replanting a delicate flower or a tree, we realized that we had to be patient until a new standard was in place, and much like plants need to be watered constantly, the miners should be “watered” regularly with education and reminders on the main topics. Sometimes the miners are unable to gather for a meeting or training due to their busy schedules with mining or other daily activities. In such cases, the CRAFT officer or the trainer on CRAFT code must work around miners’ busy schedules by going to their mine site and waiting until miners have time to listen and understand. We also realized that miners are not accustomed to the traditional education method of sitting and listening to long presentations, so the education and training efforts should be in very simple language over short periods, be understandable, and must be conducted regularly.
As for adhering to the main criteria of the standard, most of them are in line with the local regulations and laws. These include the Mongolian constitution, minerals law, civil law, ASGM regulations, taxation law, environmental and OHS rules, and law on toxic and hazardous chemicals, and etc. How miners are acknowledged and educated on these regulations is a separate issue. We decided that the risks of “paid security forces” and “conflict-affected and high-risk areas” do not apply to Mongolia’s current conditions. When it comes to the criteria of tax payment and transparency, the ASGM sector is not accustomed to paying taxes. The top issue is that the country lacks proper gold traceability mechanisms, and the miners don’t track their expenses and incomes. Due to these circumstances, it is impossible to determine how much the miners are mining and how much tax they should be paying to the state.
Thus, in continuation of capacity-building and addressing these challenges, the project conducted a series of trainings for the miners on topics of business management, accounting, OHS, gender and human rights, environmental management, formalization, and better mining practices. These trainings are aimed at giving ASGM miners the necessary knowledge and skills to improve their understanding in these areas and to promote responsible practices in the sector.
After having the mining entities co-develop and approve their internal rules, in compliance with the criteria, the project encountered its next challenge. Even though the internal rules were developed and approved by the artisanal and small-scale organizations (ASMOs), the misunderstanding from the local government led to the halting of some of the ASM operations. Without active mining operations, the rules turn into mere documents with no significance. Without real-life implementation, they can’t be tested to see if they are suitable for the organization and its conditions. Even though the project is continuously advocating for the ASGM sector by collaborating with central and local governments, the private sector, civil society, and the public, the common negative perception persists, slowing down progress.
Overcoming the challenges:
We have been carrying out activities to address the challenges and mitigate risks mentioned above. The project organized an introductory trip to Selenge and Darkhan provinces for 11 officers from government agency stakeholders and mining associations, who work with the sector, to clarify the government's understanding of the sector and to indicate the benefits of adopting the planetGOLD criteria in Mongolia. During the trip attendees were introduced to the gold traceability documentation from the planetGOLD project site and were familiarized with the current ASM gold supply chain of Mongolia. Additionally, they met with representatives of the miners, processing plant, gold traders, and local governments and discussed their involvement in the supply chain. They were informed about how gold origin is being recorded in the local areas and the processing chain from the mine to the processing plant and traders. They visited a planetGOLD mine site, which implements planetGOLD criteria and does recordings for gold traceability and had a discussion meeting on issues of non-traceable gold in Mongolia and ways to resolve them.
The objective of our trip was accomplished, and the attendees were able to see that Mongolia needs a unified mechanism to establish due diligence procedures in the gold trading sector. Although there are a few responsibly operating ASM organizations, the documentation that they are compiling is not valued by, or asked for, by the central buying and assaying agencies. Mongolia lacks a gold traceability standard and needs to make changes to its legal environment to comply with the Organization of Economic Cooperation and Development (OECD) due diligence guidance.
Although establishing due diligence mechanisms takes a lot of courage from the Government of Mongolia, the attendees of the trip and representatives of main organizations that regulate and manage the sector were equipped with knowledge and information on the international best practices, gaps in the gold origin documentation, requirements within the supply chain, and lack of will from the Government of Mongolia to implement a proper due diligence mechanism. The group members agreed that artisanal mining is a labour-intensive sector, and they should be enabled with regulations and guidelines that are motivated by human rights-based approaches.
Continuing with the analogy of re-planting or adapting a certain plant in a new ecosystem, after the implementation of the CRAFT Code/planetGOLD criteria in Mongolia, the project team understood that we need the patience and endurance of a true gardener. Just like a gardener who knows how to tend to all the specific needs of a certain plant, the project needs to balance its efforts and know when to assist the mining entities and when to step back and allow them to act on their own and let them learn from their win or the failure. For the standard to work for all the stakeholders, Mongolia needs a bigger mechanism or a regulation that will allow sustainable development for the effort that has been started by the project; the ecosystem must be suitable for the standard to be able to flourish and be fruitful. The fact that Mongolia lacks a policy or regulation to enable gold traceability is bringing conflicts and challenges in our efforts to implement the planetGOLD criteria/CRAFT Code. Therefore, the project is currently in discussion with the Bank of Mongolia to establish a mechanism for a traceable and transparent gold supply chain. This mechanism will help us not only to showcase responsible mining practices but also to contribute to the economic and social development of this sector.
Though we are constantly facing challenges, we will continue to advocate for responsible mining, gold traceability, a human rights-based approach, mercury use reduction, environmentally responsible practices, and legalization and formalization of the Mongolian ASGM sector, for a better and more professionalized ASGM.