COVID-19 & ASM: Illicit Traders Cashing in on Vulnerable Miners in Conflict-Prone Areas

Apr 10, 2020 | Alan Martin and Joanne Lebert
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We are particularly concerned about the pandemic’s impact on livelihoods, how it will fuel the illicit trade of minerals, and undermine peace and security in the country.

Despite the remoteness of most artisanal gold mine sites in DRC, there is evidence that miners in DRC are already paying a heavy price as a result of the pandemic and measures implemented by the local authorities. There is reportedly a lack of liquidity among local gold buyers, forcing miners to take significant haircuts on the spot price of their gold—as much as 30-50%, depending on location. According to IMPACT’s research, in one area of DRC’s gold rich Ituri Province, 79 out of 85 gold trading houses have shut down because they have no one to sell to. It is reported that some of those that are no longer operational have opted to trade in mercury instead—also discounted by as much as 60%— in an effort to secure some liquidity and to eventually reopen their gold buying businesses.

But where there is crisis for many, there is immense opportunity for a few—even if it comes at the expense of the already marginalized miners, the already fragile peace and security of eastern DRC, or international efforts to legitimize the ASM sector through the implementation of such initiatives as the OECD’s Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict Affected and High Risk Areas.