University of Bath

Mapping informal financial flows in the artisanal mining sector: Sierra Leone and Liberia

This project provided quantitative and qualitative data to inform both national and regional artisanal mining formalisation and economic growth strategies.

Gold mining in West Africa

This research informed evolving efforts to formalise artisanal gold mining in West Africa’s Mano River Union Region. In both Sierra Leone and Liberia, current government strategies for harnessing natural resource wealth have focused on a top-down 'growth pole' approach. But there has been little attention given to understanding how artisanal mining communities can contribute to growth through local economic development.

Sierra Leone and Liberia are home to two of West Africa’s most dynamic artisanal mining sectors, and are also where the investigators have well-established networks.

Informing policy

The researchers mapped informal financial flows in the communities where alluvial gold extraction takes place. They explored how wider changes in the financial circuits and social relations governing artisanal mining affect rural livelihoods, resource distribution and wellbeing at household level.

The project improved our understanding and quantify the informal trans-border transactions that take place. In doing so, we used an innovative methodology involving the compilation of financial diaries of those engaged in the sector, as well as others who depend on the artisanal gold mining economy for their livelihoods.

This research generated a critical baseline data on the financial landscapes of artisanal gold mining communities. It informed policy mechanisms that aim to support a formalised artisanal sector in both countries and more widely across sub-Saharan Africa.

Alleviating poverty

Through the micro-analysis of interconnected informal and socially regulated financial relationships, the research findings from this project have a transformative effect on understandings of current economic and social development strategies. In turn, the project has facilitating the implementation of poverty alleviation policies and growth measures that are more in tune with the needs of the poor.

During the process, the research deepened understanding of the trans-border financial landscapes that artisanal gold miners must negotiate, and contribute to the design of a formalisation blueprint for the sector.

In doing so, the research contributes to the International Growth Centre (IGC) by:

  • facilitating improved traceability and transparency in a rapidly evolving artisanal gold mining sector industry (State theme)
  • putting poor people at the heart of grassroots industrial development (Firms theme)
  • adding a new dimension to IGC’s work on Ebola recovery strategies in Sierra Leone and Liberia

This project builds directly on an IGC-funded pilot study carried out by the investigators in 2016, entitled; Opening the door to formalisation? Small-scale diamond mining and rural economic development in Sierra Leone.

Addressing knowledge gaps

The research addresses three important knowledge-gaps that were revealed in the pilot project:

  • there is a pressing need for a regional comparative project on financial flows within the artisanal mining in the Mano River Region, since the informal mining economy and the actors that sustain it operate across country borders
  • in policy discussions that concern the formalisation of artisanal mining, there is a dearth of accurate financial and economic data to drawn upon, particularly since most activities/transactions take place in the informal, illegal domain
  • there is an urgent demand for a detailed study on artisanal gold mining - most policy discussions and research to date have focused solely on diamonds, and until very recently, gold has largely remained an afterthought for policy makers

The project directly addresses these three important research gaps, and provides much-needed quantitative and qualitative data to inform both national and regional artisanal mining formalisation and economic growth strategies.

Project team

Funder

This project is funded by the International Growth Centre, UK.