Global Mercury Project
Policy and Governance Initiative

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I. INTRODUCTION

1. In 2006, the Global Mercury Project (GMP) launched the Strategic Plan on Policy
and Governance, presenting an action framework to promote the strengthening of policy
and governance on issues of environmental management, capacity-building and
technology transfer in the artisanal and small-scale gold mining (ASM) sector, with
particular focus on the minimization of mercury pollution. This framework builds on
initiatives previously carried out by the Global Mercury Project (GMP) and objectives
identified through global, regional and national task force meetings and local
stakeholder consultation processes. The Strategic Plan takes into account existing
regional plans, strategies, and ongoing activities. It is composed of a strategic text,
Action Framework, Table of Main Issues Considered, and Action Profiles comprised of
main highlights and outcomes of accomplishments to date.

2. The GMP, supported by the Global Environment Facility (GEF), the United Nations
Development Program (UNDP), and the United Nations Industrial Development
Organization (UNIDO), is a joint initiative with governments to demonstrate ways of
overcoming barriers to the adoption of best practices in ASM, waste minimization
strategies, and pollution prevention measures that limit contamination of international
waters. Working with authorities and public and private sector organizations, the GMP
provides assistance in the development of policy, technology support, and capacity-
building, at institutional levels and directly in ASM communities. In its pilot project
phase, GMP activities focused in six countries Zimbabwe, Tanzania, Sudan, Brazil,
Indonesia and Laos. The Strategic Plan on Policy and Governance complements the
strategies of the GMP Education and Awareness Campaigns and Technology
Demonstration Units, which are described in other reports. Though not comprehensive
of all details, this report highlights the main accomplishments, lessons learned and
outcomes of the GMP Policy and Governance Initiative in its pilot phase to inform
further developments.

3. The world-wide reduction of mercury use and pollution in mining, as called for by
the Global Mercury Project, requires action at all levels of society: training; information;
communication; methodological tools; capacity building with financial support; transfer
of know-how; knowledge of sound and proven cleaner technologies; as well as policy
development, law, and regulation. In more than 50 developing countries, there are as
many as 15 million artisanal and small-scale miners who use mercury extensively in
gold extraction and processing. As many as 100 million people may be intoxicated by
mercury from ASM, which is the single largest source of mercury releases into the
environment from intentional use. The urgency of the situation has called for reinforced

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global efforts to address hazards at their source, by removing barriers to the
introduction of cleaner technologies, and by strengthening policy and institutional
measures that will support positive and sustainable change. Building on the knowledge
from the GMP Environmental, Health, Sociological, Socio-Economic and Legal Studies,
the GMP has been executing targeted initiatives assisting participating governments, on
issues ranging from national legislation and institutional capacity to community
training, with lessons applied to projects with Governments in other countries as well. A
key goal of this report is also to draw recommendations for future projects of a more
global reach, for instance, in the promotion of the International Guidelines on Mercury
Management in ASM.

4. The effective involvement and coordination by all concerned stakeholders is seen as
essential for achieving the aims of the Global Mercury Project. Governments, the driving
force of the implementation programs and activities, have been encouraged to seek the
assistance of UNIDO in any identified or related technical, strategic or policy matters.
The mobilization of non-governmental organizations and existing ASM institutions has
been important to ensure the practical application of environmentally sound
management. The enhancement of information exchange and education at all levels is of
paramount importance for achieving the aims of the GMP, with active participation of
governmental institutions. This report emphasizes that sustained progress requires
ongoing and dynamic processes of decision-making, policy development and field
implementation with broad, inclusive and active stakeholder participation.

II. VISION

5. Building on the achievements of the pilot phase of the Global Project Mercury, this
report asserts a vision that the improvement of environmental management in ASM
must be accessible to all stakeholders, emphasizing the minimization of mercury use,
pollution and exposure and the strengthening of capacity-building.

III. AIMS

6. The fundamental aims of the Policy and Governance Initiative are the removal of
barriers to the improvement of environmental management in ASM, particularly the
prevention and minimization of mercury use and pollution, the active promotion of the
transfer and use of cleaner technologies, and the strengthening policy and institutional
measures that will support positive and sustainable change.

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IV. GUIDING PRINCIPLES

7. A set of interrelated and mutually supportive principles were developed to support
the implementation of the GMP policy and governance activities described under
Sections V, VI and VII below. These are:

a)
To promote and support existing national and regional policy initiatives for
sustainable development on ASM issues, linked with efforts in progress;

b)
To collaborate with existing institutions and programs to develop and promote
policies encouraging use of cleaner technology in ASM and the reduction of mercury
use;

c)
To strengthen the capacity of governments to implement policy and sustain the
capacity and technology after GMP efforts have been completed;

d)
To tailor activities to individual countries based on a bottom-up needs -assessment
process; given the specific circumstances of the different countries concerned, each
country should be encouraged to identify its own policy needs;

e)
To involve experts in designing communication tools for creating awareness at the
highest level of governments, and other institutions, to promote GMP goals;

f)
To engage and motivate selective partners to bring added value to making progress
in the short and long-term, including public-private sector partnerships;

g)
To undertake periodic review of policy activities in relation to agreed indicators;

h)
To promote principles of transparency and accountability in government initiatives
and programs;

i)
To integrate gender-specific strategies, as well as education and training for women,
in formulating relevant policies, and to promote the participation of women in policy-
related decision-making;

j)
To support the implementation of global and regional environmental conventions
and legal instruments related to mercury and related ASM issues;

k)
To promote and support South-South cooperation related to ASM development
issues and mercury reduction;

l)
To provide assistance for developing and facilitating compliance with multilateral
initiatives and guidelines aimed at reducing mercury; and

m) To recognize the relationship between poverty and environmental stewardship,
including the implementation of poverty reduction strategy programs to support GMP
objectives.

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V. ACTION FRAMEWORK

1. International Guidelines on Mercury Management
Development of UN International Guidelines on Mercury Management in Artisanal and Small-
Scale Mining

2. Capacity-Building and Institutional Strengthening
Strengthening of Multi-Sector Cooperation with Government Agencies and other Organizations
in Support of Capacity-Building, Training, Technology, Education, and Mobilization of
Resources to Facilitate and Assist in Fulfilling the Aims of the GMP

3. Policies on Mercury and Artisanal and Small-Scale Gold Mining

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3.1) National Mercury Use

Assistance to Governments in the Development of Appropriate National Policy,
Legislation and Regulation on Mercury Management in ASM

3.2) Compliance Strategy

Reinforcement of Government Capacity to Promote Compliance with Regulations in
ASM Communities through Education, Monitoring and Enforcement Strategies

3.3) National Mercury Trade

Development of Knowledge and Tools for the Reinforcement of National Capacities to
Monitor and Regulate the Domestic Trade and Distribution of Mercury Used in ASM

3.4) Transboundary Mercury Trade

Assessment and Recommendations on the Transboundary Trade of Mercury with a View
of Reinforcing Capacities for Regulating the Export and Import of Mercury Used in ASM

3.5) National ASM Sector Policy

Development of Recommendations to Governments on Policy to Enhance Coordination,
Pro-Poor Empowerment and Rights in the ASM Sector

3.6) Micro-Finance Initiative

Development of Pilot Programs Enabling ASM Communities to Access Credit and
Finances to Support Technology Transfer

3.7) Fair Trade Gold

Development of Global Certification Criteria and Equitable Market Policies and
Processes for Fair Trade ASM Gold

4. Global Partnerships for Development
Strengthening and Expansion of Global Partnerships for Development - Joint Activities,
Regional Network Capacity-Building, Global Awareness and Resource Mobilization

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Capacities to Track, Monitor
mechanisms to, and within, the ASM sector
and Regulate the Domestic
· Tools to support sustainable monitoring of the import, sale
Trade and Distribution of
distribution, and use of mercury
Mercury Used in ASM
· Reinforcement of national capacities to detect and halt

illegal traffic in mercury and stockpiling of mercury

· Development and implementation of legislation and

institutional frameworks, including a legal base for regulating

mercury trade and conduct of inventoriess, e.g. hazardous

substance audits, disposal and phase- out plans, etc

· Assessment of legality of particular trade practices, such as

setting standards for market mercury prices; limiting free

mercury dealing by gold purchasers

· Licensing traders; etc

3.4 Assessment and
· Analysis of data submitted by Activity 3.3 to prepare
Recommendations on the
national plans to reduce transboundary trade of
Transboundary Trade of
mercury to a minimum
Mercury with a View of
· Review of national waste management infrastructure and
Reinforcing Government
systems in the context of transboundary trade by national
Capacities for Regulating the
authorities and tools to measure effectiveness
· Development of national regulation and institutional policy
Export and Import of Mercury
to restrict imports of mercury
Used in ASM
· Assessment of regional and global patterns of transboundary

trades of mercury with a view to improving coordination
among Governments in developing standards or common
approaches to reduce export and import
· Promotion of awareness about mercury in ASM as a means
of encouraging industrial countries to ban or restrict the
export of mercury to developing countries

3.5 Development of
· Legal recognition of ASM
Recommendations to
· Incorporation of a poverty reduction dimension in
Governments on Policy to
mining policy, recognizing both the constraints and the
Enhance Organization,
potential of ASM as an economic sector
· Formalization of ASM activity with incentives for registration
Coordination and Pro-Poor
· Simplification of registration and licensing procedures
Empowerment and Rights in the · National programs for technology assistance and training
ASM Sector

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3.7 Establishment of
· Development of environmental, social, and economic criteria
for Fair Trade gold, including mercury-related criteria
Certification Criteria and
· Development of organizational capacity in mining
Processes for Fair Trade Gold in communities for meeting progressive Fair Trade Criteria
ASM
· Development of niche markets for Fair Trade gold by

building on previous experience with fair trade markets amd

establishing supply chain networks which deliver gold

from small-scale producers more directly to refineries and

linkages between ASM producers to international markets.

· Communication and promotion of the initiative's findings and

program of action, including the identification of models of

certification and an international certifying agency

4. Strengthening and
· Consolidation of strategic partnerships to support regional
Expansion of Global
and global action plans with major stakeholders and
Partnerships for Development
opportunities for environmentally sound management
- Joint Activities, Regional
activities emphasizing mercury minimization and the
Network Capacity-Building,
strengthening of capacity-building and technology transfer in
Global Awareness and Resource ASM and related developmental issues
· Development of joint activities with other initiatives of
Mobilization
UNIDO, UNDP, GEF, UNEP and other international

agencies; public authorities; international organizations; the
industry sector; mining companies, NGOs; and academic
institutions, identifying opportunities and synergies
· Identification of opportunities and implementation of
programs that replicate GMP capacity-building in other
countries (e.g. Mozambique, etc); formation of partnerships
with other organizations and developing knowledge on
mercury, ASM infrastructures and future needs and priorities
· Dissemination of the produced GMP results and
identification of opportunities that will allow the project to
continue beyond 2007 through self-financing, including
conducting donor conferences to solicit financing and
workshops with potential contributors
· Enhancement of awareness of mercury and ASM issues on a
global scale through public media and media for donors

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ACTIVITY 2

Capacity Building and Institutional Strengthening
Strengthening of Multi-Sector Cooperation with Government Agencies and other
Organizations in Support of Capacity-Building, Science, Technology, Training,
Awareness and Mobilization of Resources to Facilitate and Assist in Fulfilling the
Aims of the Global Mercury Project

OVERVIEW:

Just as legal and regulatory aspects play a key role in strengthening environmental
governance in the ASM sector, policy development to address institutional and community
capacities is fundamental. The GMP recognizes that strengthening cooperation amongst
various government agencies is essential for success. Additionally, capacity-building must
occur at all levels. Building local, regional and national capacity for the science and
technology of improved mining techniques is essential, as is the mobilization of resources to
ensure the uptake of the improved technology. This is not only important to ensure that
regulatory standards can be met, but also to ensure that mining activities can evolve in
sustainable ways and contribute positively to the economic development of the sector. The
GMP has been working with governments to encourage policies that build government
capacities at the local level and that enhance collaboration with different institutions. A
critical policy objective of the GMP is to ensure that countries can build institutional
functions that ensure the sustainability of capacity-building measures as demonstrated by
the Awareness Campaigns and TDUs.

GOALS:

GMP goals are to build on the specific local strengths to address the following:

Promotion of effective sustainable partnerships with major stakeholders and
opportunities for joint environmentally sound management activities emphasizing
mercury minimization and the strengthening of capacity building

·Cooperation and partnership at all levels between public authorities, international
organizations, the industry sector, NGOs and academic institutions

Participation in the implementation of GMP Education and Awareness Campaigns and
Technology Demonstration Units in project sites; joint activities in other ASM regions;
establishment of education centers for ASM located in critical ASM regions

Enhancement of information exchange, education and awareness-raising in all sectors of
society

Identification of priority sites for future capacity-building

Development of national inventories of technology capabilities, production centers and
support mechanisms

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HIGHLIGHT
New Mercury Policies in Zimbabwe: Promoting
Cleaner and Equitable Technology Standards

The GMP team has worked with the Zimbabwe Ministry of Mines to develop capacity-
building policies in artisanal and small-scale gold mining (ASM) communities. Following
stakeholder consultations, GMP experts worked with various agencies to prepare
Regulations on Mercury Management in ASM. These constitute multiple new steps in
Zimbabwe, setting standards on practices to eliminate hazardous mercury emissions,
exposures, and other environmental health aspects in ASM. Regulations also addressed the
purchase, trade and storage of mercury. Meetings, small workshops and large seminars were
facilitated by the GMP team with national and local officials from the Ministry of Mines,
the Ministry of Environment, and the Ministry of Health, as well as mining associations
(e.g. Zimbabwe Panners Association and the Zimbabwe Mining Federation) and other
organizations. These talks reinforced the shared commitment on policies to phase out
mercury in ASM over the next year and in the long term. In the short term, policy efforts
focus on instituting and enforcing clear regulations and codes of practice to minimize
mercury-related and other environmental hazards in ASM.
The Regulations on Mercury Use provide standards for amalgamation, including the use
of retorts, and for reducing mercury in tailings. Specific provisions protect pregnant women
and children from exposure. The regulations include mechanisms for community-based
enforcement and monitoring. The policy to ban copper plates is designed to significantly
improve environmental health and ensure that fair technology is used so that miners receive
a reasonable percentage of gold from the ore they mine. The Ministry of Mines will
introduce these laws in 2007, as Statutory Instruments under the Mines and Minerals Act. A
local team, led by the Department of Metallurgy and Institute of Mining Research, is
conducting field demonstrations to educate stakeholders on how to comply with the
standards (see page 33); the new law will be formally introduced after these demonstrations.

Left: Officials at the Zimbabwe Ministry of Mines with GMP policy experts
Right: Miners express views on the need for better milling technology standards

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HIGHLIGHT
Environmental Responsibility and Multi-Actor
Accountability: Proposed Labor Laws in Zimbabwe
In addition to technical regulations on mercury management (described on the previous
page), GMP policy experts prepared recommendations and draft regulation on Water
Protections, the Duties of Milling Centre Managers and Claim-Holders, and other issues
that resulted from the policy reviews and stakeholder consultations. These proposals were
also presented and discussed on a preliminary basis with the national directors of the
Ministry of Mining and Mineral Development as possible regulations to incorporate into
law in 2007, subject to further discussions and revisions.
Most significantly, the draft measures propose clear lines of responsibility for miners as
well as milling centre managers and claim-holders, with various environmental
management issues addressed and penalties provided for legal infractions. In Zimbabwe,
miners generally bring their ore mined to milling centers for processing. Mercury is used
heavily on these premises, and tailings management and mercury handling often present
serious risks to health and the ecosystem. Because the relationship of miners and millers is
not generally of a formal employer-employee nature, traditional legal definitions of
employer responsibility do not necessarily apply. The draft measures acknowledge the need
for shared responsibilities among the different people involved in ASM mining and
processing. Responsibilities addressed in the draft regulations relate to mine management,
fair labor practice, safety, health and the preservation of the environment. Mercury issues
are particularly emphasized, so that millers are responsible for sound mercury management
on their premises and for ensuring compliance with regulations. Among the issues
addressed, the draft regulations stipulate that milling centre managers must set aside a
designated location for amalgamation and equip that facility with retorts. The provisions
also stipulate that milling centers must not exist within 100 meters of water bodies, and the
combined use of cyanide and mercury is prohibited.

Miners Using Mercury in a Milling Centre in Kadoma District, Zimbabwe
(Note: the new Mercury Policy phases out these amalgamation plates)

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HIGHLIGHT

Mining, Watersheds and Protected Lands in the Brazilian
Amazon: Using Satellite Imagery to Inform Policy

In regions across the Brazilian Amazon, mining causes significant mercury pollution,
leaving profound environmental and social impacts. While the GMP's capacity building program
works to reduce mercury-contaminated sediment movement into streams and develop proper
native vegetation in the riparian zone, the project also undertook a review of Brazilian laws and
policies of protected watershed areas and natural reserves. Additionally, the project has developed
innovative GIS-based mapping techniques to assist in the discussions on government policies
concerning the protection of the designated lands.

Natural reserves are the foundation of the Brazilian Forest Code, which, in 2002, set new
regulations for the establishment of natural protected areas along hilltops, ridgelines, riparian
zones, and upland catchments, relying on key geographic features of watersheds. This new
legislation deters all commercial land use on reserves and imposes severe restrictions for uses
such as mining. While this represents a remarkable advance in environmental legislation, these
increased protections still remain a reality only on paper. The lack of appropriate countrywide
topographic datasets and the expertise required for manually mapping the reserves, along with
difficulties of enforcing regulations "on the ground", were identified by government agencies as
main barriers in enforcing the current legislation. Recent technological advances in Geographic
Information Systems and high-resolution topographic satellite imagery, such as those provided by
the Shuttle Radar Topography Mission, have allowed this issue to be revisited. The solution to
this problem relies on accurately mapping and quantifying current and potential land use conflicts
on a regional, watershed basis, thus enabling a reliable evaluation of its political and economic
scope.

The GMP is developing the application of this methodology for mapping permanent
preservation areas in the Tapajos River Basin , located in northern Brazil. This will allow new
and innovative ways of monitoring mining activities that relate to environmental legislation on
protected lands. This GMP program is also developing the use of the satellite imagery to track the
mobility of mercury from mining sites in the sediments of rivers and streams, in order suggest
new policy measures to promote capacity-building and reclaim impacted areas.

Aquaculture in the Brazilian Amazon

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INDICATORS OF SUCCESS:

Comprehensive information is gathered and tools are developed to ascertain quantities of
mercury being distributed and their source; and tools are developed to track, monitor and
regulate mercury in each of the participating countries.

HIGHLIGHT
Regulating Mercury Trade to Miners: Proposed
Legal Provisions in Zimbabwe

Numerous reports have emphasized that the development of monitoring and regulation
of mercury trade would be a crucial step to decrease the negative health, social and
environmental impacts caused by mercury in Zimbabwe. In December 2005, GMP policy
experts prepared draft regulations under the Mining Laws to address trade and distribution
of mercury within the ASM sector. These were discussed with Senior Directors of the
Ministry of Mines and Mining Development as measures that could potentially become part
of a larger national effort, including other sectors besides mining, to regulate that trade of
mercury that is used for ASM. The draft measures address licensing for the purchase of
mercury and for amalgamation purposes. Measures are also proposed to institutionalize
community monitoring of the quantities of mercury used for ASM.

Provisions for amalgamation licensing include:

"1) The use of mercury for amalgamation purpose shall require an amalgamation license,
which shall be applied for by the manager of the mining location at which the amalgamation
is being contemplated;

2) An amalgamation license shall be issued by the Mining Commissioner and shall specify
the mining location at which amalgamation is being licensed, to whom the license is
granted, and the site within the mining location at which amalgamation shall take place,
designated by a plan.

3) An amalgamation license shall be valid for 1 (one) year and may be renewed.

4) In the event of breach of these regulations, the Mining Commissioner may cancel the
amalgamation license for the mining location for which the breach has taken place."

Provisions for purchase of mercury include:

"...no person may purchase mercury for amalgamation purposes unless they hold an
amalgamation license."

The drafted regulations include penalties for contraventions of provisions of these
regulations.

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INDICATORS OF SUCCESS:

International actions taken to support the restriction of mercury trade; and governments of
the participating countries are able to regulate export and import of mercury across their
borders.

HIGHLIGHT
GMP Contributes to Global Awareness of
International Mercury Trade Reduction Measures

The GMP submitted the report "Global Impacts of Mercury Supply and Demand in Small-
Scale Gold Mining" for the 2007 U.N. Global Environment Ministerial Forum in Nairobi
(February 2007, Nairobi Kenya). The report was circulated to member state governments
globally and provided the foundation for discussions at the Forum. Among other results,
this report and other contributions like it have had the following results

The GMP has been active in raising awareness of mercury and ASM-related concerns in
international policy arenas. Team members have reached out to various media sources
internationally, including newspapers, scientific journals, conference presentations, etc. to
promote awareness of the issues and the policy initiatives underway.

Since 2005, the GMP has been contributing to the awareness of the landmark decision of
the European Union Council of Environment Ministers in 2005 to end all international trade
of mercury by the European Community. The EU decision, reached June 24th in
Luxembourg, calls for a phase-out of mercury trade by no later than 2011. It also reiterates
the EU commitment to achieving a global phase-out of all mercury production, use and
trade, and reinforces the need for binding international law. The EU trade restrictions are
the first effort to prevent the spread of mercury to countries in Africa, Asia, and South
America, where mercury use is prevalent, particularly in small-scale gold mining. The EU,
U.S., and China are the main exporters of mercury. A phase-out of mercury use in North
America and Europe has made the developing world the primary destination for the world's
mercury.

The United States recently cited the GMP report in explaining its policy decision (February)
to refrain from releasing mercury stockpiles onto the global market.

Discussions are still being pursued on the global level to decide what actions countries will
take to reduce trade.

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HIGHLIGHT
ASM Policy Recommendations Submitted to the
Indonesian Government

In November, GMP policy experts conducted a series of consultation meetings (pursuant
the various GMP goals) with officials from the Indonesian Ministry of Energy and
Minerals, the Ministry of Environment, the Central Kalimantan Provincial Government
(Mining, Environment and Health Offices), and the District Environmental and Mining
Offices. Consultations were also held with other stakeholder organizations such as the
Indonesian Mining Association, in the discussion and development of plans to strengthen
mining and environmental regulations.
Working principally with the National Director of the Legal Department of Ministry of
Energy and Mineral Resources, the GMP has established plans to draft district-level
mercury management regulations that could be applied nationally in the future as well under
the Mining Laws. Discussions with authorities also focused on the GMP Indonesian legal
expert's report, including the following preliminary recommendations:

1. A Special Provision on ASM in New Mining Law
The Indonesian government is now seeking to produce a new Mining Law to replace the old
Mining Law No. 11 of 1967. By establishing this law, the Government wishes to create a
new paradigm of mineral development in Indonesia. The GMP legal report recommends the
development of special provisions that facilitate the legal framework for ASM recognize its
prominence and to promote the formalization of informal ASM activity, as well as the
development of accompanying regulatory frameworks.

2. Regional Environment Act and Local Authorities
It is recommended that Indonesia apply a flexible national environmental policy system that
leaves monitoring environmental protection powers to local authorities. It is also
recommended that local district and provincial authorities be given greater powers to
introduce local legislation on certain mining issues.

3. Environment Administrative System
It is recommended that environmental administration be clarified so as to ensure
coordination among the relevant ministries and agencies.

4. Community-Based Environmental Management
Mechanisms for community-based environmental management are proposed.

5. Special Environmental Court
It is recommended that Indonesia establish an environment court as a judicial instrument for
controlling disputes, incl. impacts from large-scale mining and ASM

7. Government Assistance to ASM
Measures are proposed for regulating ASM, developing alternative livelihood opportunities,
supporting formal-ASM activities as a contributor to poverty alleviation, economic
mechanisms, promoting women's rights, reducing child labor, etc

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HIGHLIGHT
Governance Issues Related to Mercury and Gold-
Purchasing in Mozambique: Recommendations
Submitted to the Minister of Mines

In 2005, the GMP conducted a pilot project in Mozambique to remove barriers to
mercury reduction in Manica District. The initiative was supported by Blacksmith Institute,
in conjunction with GEF, UNDP, UNIDO and the Mozambique Ministry for the
Coordination of Environmental Affairs. In addition to the implementation of a capacity-
building program focusing on technology transfer, the fieldwork also yielded various policy
recommendations for the government. These recommendations were prepared in the form
of a report which was delivered and discussed with MICOA as well as the Minister of
Mines and various directors in the Ministry. The recommendations, and the context for
them, are discussed below.
During the pilot project activities, it was observed that the government buys only 1kg
out of 40kg of gold being produced monthly in the region. In spite of the better price being
offered by the government, miners are overwhelmingly selling their gold to the private
buyers in the area because of three factors: 1) the private buyers are more present than the
government in the mining sites; 2) the private buyers are providing mercury for free (in
exchange for a guaranteed gold sale) in an area where mercury is difficult to obtain; 3) the
miners are not confident that the government scheme will pay them for all the gold they
produce
In light of the above factors, the GMP recommended that the government should buy
gold on site. If the government is unable to travel to the mining sites to buy gold, then it is
recommended that the government should receive the gold in an appropriate place where (a)
mercury exposure is limited and (b) miners can see the gold being cleaned with acid from
impurities. Currently, government gold buyers are being contaminated when they buy gold
with residual mercury in offices in the town of Manica. One of the solutions is that the
government gold buyers should receive the gold in the lab, i.e. under the fume hood and
dissolve residual mercury with nitric acid, instead of receiving the gold in the confined
office space where contamination is a factor. Doing this, these employees will be able to
reduce their exposure to mercury fumes and this would also allow miners to see the mercury
being leached directly and immediately see the gold that is recovered. This will increase the
credibility of the government gold buyers and will attract more miners to sell gold to them.
Additional fieldwork should identify and work with the gold buyers (both government and
private) to promote the establishment of cleaner and more efficient technologies, improved
facilities and better practices.
The 4 benefits of the recommendations, if implemented, would be:
1) improved occupational health in gold-purchasing facilities (less mercury exposure)
2) enhanced trust between miners and government gold-purchasers
3) increased government revenue from gold produced in the region
4) increased prices for miners for their gold

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based on interactions with the banks as well as with miner associations and cooperatives.
Preliminary reports have been produced for Tanzania, Sudan, Indonesia, and Zimbabwe.

Results obtained thus far reveal a number of strategic opportunities. Some banks expressed
interest - potentially - in opening new branches in ASM communities. In other cases, banks
indicated that they are already providing some funding to some miners for certain purposes
(but only on a very limited basis); in other cases, banks have branches already in ASM areas
and are very ready to evaluate applications for loans from miners.

All the banks and institutions with which the GMP team met emphasized that they are
interested in developing these programs, keeping in mind that they are profit-based and
have particular requirements for assessing any loan applications. Usually, criteria for
accessing individual loans involves having collateral, however, many banks also have
programs allowing groups without to collateral to take out shared loans on a collective basis
where each member of the group holds the other accountable (based on "village banking"
models and other models). The GMP team has indicated that the different options would
be discussed with the miners to identify best opportunities.

The information regarding the banks' programs are being discussed in education workshops
with mining associations and cooperatives in Educational Workshops. Additional plans for
training on business skills, equipment sharing, cooperatives, collective lending, savings, etc.
are also underway. In cases where miners are able to qualify for loans, they need to be able
to keep records in order to function in a micro-credit institutional framework. Micro-credit
institutions have some book-keeping materials that they use once a program is operational.
However, the GMP believes that business skills are important even for miners who are not
taking out loans, as "micro-savings" is also an important approach to build the capacity of
miners to adopt substantially cleaner technologies that reduce mercury and improve gold
recovery.

The following 4 phases of initiatives are being implemented:

Phase 1: Identification of Micro-Credit Opportunities and Challenges in ASM

a) conduct a preliminary itemization of the equipment and supplies (as well as costs) to be
targeted for ASM capacity-buliding programs and assessment of the local accessibility of the
equipment

b) review literature and readily-available resources to identify micro-credit schemes used in
the country

c) consult miners' associations, government institutions, and relevant NGOs to identify their
perception of opportunities for financial assistance and barriers to access, as well as
contacting management of local financial institutions (micro-financing agencies and banks)
to compile information on individual operating procedure

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HIGHLIGHT
Microfinance Training in Sudan: Linking with NGOs
and Government for Local Grassroots Empowerment

Artisanal small-scale gold mining activities represent an essential livelihood source to some of the
poorest people of Ingessana Hills in the Blue Nile State. The GMP has recruited an NGO, Practical
Action, to organize miners into groups in order to enhance capacities to use collective micro-loans
for transferring to improved technology that will reduce mercury use and emission. The pilot project
is intended to be the seed of significant change in the Ingessana Hills, but would start small and
simple, with 4 groups of 25 people each that will be trained to be successful small scale miners. This
success would be key for encouraging other groups in the future. The four groups are selected to
involve key figures in the artisanal communities.

They are being technically trained and supported to organize themselves. Since the compete kit
(equipments to improve technology) may cost up to US$ 12.000 (international price tag), each group
of 25 miners is trained to assess whether they could afford this kit though a micro-credit scheme,
where the repayment should be done in monthly installments payable within 24 months period. It is
important to emphasize that to make the repayment affordable for the 4 groups and consequently for
the miners, a subsidy (%) from the government or private agencies for the costs of a kit is needed.
Therefore, the GMP has developed contact with the governmental and NGO partners as well as local
manufacturers who "copy" cheaper alternatives. Hence the installments could reach around US$
10/month per miner.

This system would substantially increase the chances of success of these groups still requiring
repayment, as they have a credit and they have to be well trained to manage their small business. The
partnership with the government or private agencies is important, as it reduces costs for the miners as
well as increases the chances for the community members to acquire efficient gold processing
equipment. This subsidy should not be seen as a donation but as a facility for attracting the miners to
be organized in groups, introducing the concept of small business and the concept of
entrepreneurship and consequently increasing their chances of success.

Envisioned Model:

Miners
Form Groups
Practical Action (NGO)
Provides Training to Miners
Government Subsidies
Keeping Loan Interest Rates
Low to Encourage Repayment

Micro-Finance Institution
Women miners in Ingressa Hills
Provides Group Loans

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Global Mercury Project
Policy and Governance Initiative

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HIGHLIGHT

Trust-Building, Leadership and Organization Training: Pilot
Testing New Development Approaches in Tanzania

In May 2006, a team of GMP trainers participated in a pilot initiative to demonstrate and explore
how training exercises on trust-building and co-operative organization could enhance livelihoods
in ASM communities. The initiative demonstrated the benefits of group decision-making and
teamwork in ASM as a way of promoting effective and equitable development and enabling the
conditions for the adoption of cleaner technologies that reduce mercury use.

These exercises followed a series of related training workshops on technology, business
development and micro-credit in Geita. This initiative involved women and men in a variety of
participatory exercises. Focus group discussion and activities with 13 women working at Blue
Reef Mine with the following objectives: develop profile of specific subgroup involved in ASM,
test activities designed to promote organizational change and cooperative behaviours, identify
current barriers to cooperation and improved organization. Focus group discussion was followed
by a series of activities based on economic game theory to derive scientific data on conditions for
cooperative and other pro-social behaviour, variables impacting cooperation and factors
determining the current uncooperative, suboptimal work structure.

Leadership analysis was conducted with a sample of miners in the local area and mining
organizations. The level of leadership capacity varied significantly, across demographic profiles.
The outcome of the experience confirmed the strong value in focusing on local leadership
development as vehicle for improved community organization and development. The trainers
who participated suggested that using the "trust games" approach could help mining associations
organize themselves in new ways (ore-sharing, technology-sharing, collective loans, etc) that
would raise standards of living and promote cleaner technologies.

Left: The District Mines Officer, Mr. Kabadi, explains to trainers that primary mining license
holders as well as miners should take leadership to improve organization in ASM operations.
Right: A discussion amongst trainers explores different methods for engaging miners.
Right: Local GMP trainers in Geita examine the organization structure of a mine operation

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HIGHLIGHT

Fairer Trade: Partnerships between Banks, Gold
Refineries and ASM Communities in Tanzania

The GMP conducted a series of consultations with the Federal Bank of the Middle East (FBME)
in Tanzania, and its subsidiary Africa Precious Metals Ltd, to identify ways of strengthening
economic services in artisanal and small-scale mining communities. Beginning in 2006, meetings
were held in Dar Es Salaam to identify ways of improving gold marketing/buying services, gold
refinery standards of operation (including safe mercury use), micro-credit services, and other
aspects that would improve social, economic, environmental development in ASM communities.

By early 2007, the Federal Bank of Middle East (FBME Bank) Ltd has invested over
US$1million in a new gold refinery plant in Tanzania's Mwanza region to add value to gold
exports from small-scale miners. The FBME Bank Chief Executive Officer announced that the
refinery would target small-scale miners, who without a defined market-have been loosing out to
middlemen and businessmen in the black market, to smugglers and through money laundering.
He said the new refinery would cater for small-scale miners by improving the quality of their gold
and subsequently their standards of living.

The objective now is to collect "raw gold" through the regional miners associations at attractive
prices and refine it to a finished product quality of above 99.5% before exporting it as "bullion
gold". According to existing plans, the business would be expanded to other regions of the
country, at the appropriate time.

The full production capacity of this unique and modern refinery is estimated at about 50 tonnes of
gold per annum. Africa Precious Metals Ltd (APM), a subsidiary of FBME Bank Ltd, which
constructed and is operating the refinery, and has opened four regional gold collecting centres at
Ushirombo, Rwamagasa, and Nyarugusu called FairTrade Gold Centers (FTGC).

APM will reportedly also expand to other regions of Tanzania to assist and support small-scale
miners for the fair trade of their gold on the world market. Delegations of other East African
countries (Kenya and Uganda) and the Latin American countries have visited these collection
centers (FTGC) and would like to copy this unique project.

Tanzania has become one of the fastest-emerging gold producers in Africa, and seems to be the
third-largest gold-producing country after South Africa and Ghana. The annual production of
gold has increased from around 43.2 tonnes in 2002 to about 48.0tonnes in 2003. Tanzania now
has proven gold reserves in excess of 1000 tonnes. In 2003 Tanzania reported a 20% increase in
gold exports from US$ 41 million to US$ 50.4m.

The GMP aims to continue to provide assistance in ensuring that the refineries adopt best
practices to meet environmental standards (particularly to minimize mercury use), and provide
assistance to enable miners to sell gold at appropriate prices and obtain technical support.

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HIGHLIGHT
Fairer Trade: GMP Stakeholder Workshops Support
Reforms on Gold Pricing Policies in Zimbabwe

Due to the current economic crisis in Zimbabwe, gold mining has grown in importance as a
source of survival. Over 2 million people depend on artisanal and small-scale gold mining across
Zimbabwe. As environmental threats have increased, the country has also seen growing conflict
in the mining sector. In the first three months of 2006, police arrested over 30,000 indigenous
miners. Smuggling, illegal mining, mercury and other problems have been cited as challenges.
Irresponsible police intervention has also been cited as a major problem. GMP-supported
assessments found that these problems were mainly fuelled by the underlying failure to
implement economic policies that pay miners fair and appropriate gold prices, which forced them
into desperate conditions of work and trade as a means of survival.

Between February and April in 2007, the GMP Policy Coordinator conducted several stakeholder
meetings in Zimbabwe to bring together miners, government decision-makers from different
agencies, and other organizations, to identify and advance strategies for bringing solutions to the
country's challenges in the mining sector. The aim of the meetings was to allow participants to
express a diversity of concerns to influence policy changes. In addition to conducting stakeholder
meetings, the GMP Policy Coordinator participated in Special Committee Hearings in Parliament
to review gold mining policies. A variety of GMP recommendations were generated (as in the
reports of the Policy Coordinator), with the major recommendation being to increase the gold
price to the official international gold price level in line with inflation.

Following advocacies by various stakeholders, in the second week of May, 2007, two major
decisions were reached by the Government of Zimbabwe:

1) Gold Price Increased - The Reserve Bank of Zimbabwe (RBZ) raised the gold support price
by 2,178% from Z$16 000/ounce to Z$350 000/ounce. This price is estimated to significantly
reduce illegal trading, and provide an economic system that will make mining viable.

2) Gold Price Review Committee Established - Significantly, the Parliamentary Committee has
moved to establish a review committee to ensure that gold prices are regularly evaluated and
adjusted as inflation continues in the future, to ensure fair and appropriate gold prices.

These major policy developments require ongoing monitoring. They represent some out of the
many policy recommendations that were generated to encourage positive changes in the mining
sector to improve livelihoods, environmental sustainability and the country's development as a
whole. It is recognized that "removing barriers to the adoption of improved small-scale mining
practices" (the Global Mercury Project goal) requires an integrated approach that is responsive to
local, national and regional needs, and that the GMP can continue to play a significant role in
brining together stakeholders in problem-solving and strengthening institutions for development.

Further GMP work is recommended to follow up on these and other aspects of policy and
governance in the growing small-scale gold mining sector of Zimbabwe.

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Global Mercury Project
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ACTIVITY 4

Global Partnership for Development
Strengthening and Expansion of Global Partnerships for Development - Joint
Activities, Regional Network Capacity-Building, Global Awareness and Resource
Mobilization

OVERVIEW:

The world-wide reduction of mercury use and pollution in mining, as called for by the
Global Mercury Project, requires action at all levels of society by the 55 developing
countries where ASM is prominent as well as industrial nations. To sustainably address the
challenge of mercury contamination for artisanal and small-scale gold mining, a broad-
based approach to development is needed. The GMP is committed to work closely with
other agencies, and governments of other countries, to strengthen and expand global
partnerships for working together in joint initiatives regionally and internationally, to
promote global awareness of the situation in ASM, mobilize resources, and contribute to
sustainable development.

GOALS:

GMP goals are to:

· Consolidate strategic partnerships to support regional and global action plans with
major stakeholders and opportunities for environmentally sound management
activities emphasizing mercury minimization and the strengthening of capacity-
building and technology transfer in ASM and related developmental issues

· Develop joint activities with other initiatives of UNIDO, UNDP, GEF, UNEP and
other international agencies; public authorities; international organizations; the
industry sector; mining companies, NGOs; and academic institutions, identifying
opportunities and synergies

· Identification of opportunities and implementation of programs that replicate GMP
capacity-building in other countries (e.g. Mozambique, etc); formation of
partnerships with other organizations and developing knowledge on mercury, ASM
infrastructures and future needs and priorities

· Disseminate the produced GMP results and identify opportunities that will allow the
project to continue beyond 2006 through self-financing, including conducting donor
conferences to solicit financing and workshops with potential contributors; and

· Enhance awareness of mercury and ASM issues on a global scale through public
media and media directed at donor communities

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HIGHLIGHT
Preventing Mercury Pollution in Manica District,
Mozambique: Community Capacity-Building with the
Ministry for the Coordination of Environmental Affairs

The environmental health impacts of artisanal gold mining have been growing concerns in
Manica District, Mozambique. Currently, more than 12,000 people in this region are involved in
ASM, and most people extract gold using mercury. With support from Blacksmith Institute,
experts from the GMP and the Ministry for the Coordination of Environmental Affairs carried out
a pilot program to reduce environmental and occupational hazards by promoting safer and more
efficient uses of mercury. Training methods were adapted from those being implemented in the 6
main GMP countries.
Assessments in Manica revealed that mercury management practices cause significant
pollution hazards in this area; human exposure was a severe problem because miners burned the
mercury amalgams in open-air bonfires throughout the community. Based on breath test samples,
the average level of mercury in the miners in Munhena, the main training site, was 8.23 µg/m³.
Some burners had above 50 µg/m³ (50 times higher than the WHO guideline for maximum public
exposure to mercury vapor). A training curriculum was conducted to introduce miners and their
families to retort technologies and related ways of reducing mercury emissions. Tests performed
with home-made retorts, made of salad bowls, showed that mercury emissions can be contained
to allow 95% of the mercury to be reused. Miners effectively adopted the retorts and expressed
that the relatively inexpensive nature of this technology, costing less than US$4, was feasible,
especially after acknowledging the economic benefits that arise by reusing the mercury. The high
price of mercury in Munhena (US$100/kg) is resulting in heightened attention on the need to
minimize mercury losses.
Through discussions with community members and the government, the team identified
follow-up plans including the establishment of a community amalgamation centre. The GMP
recommends further capacity building in Mozambique and is planning further collaborative
initiatives with the support of Blacksmith Institute, UNDP, GEF, and UNIDO in other countries
as well, such as Guinea. This pilot initiative with Ministry for the Coordination of Environmental
Affairs also generated policy recommendations that were delivered to, and discussed with, the
Minister of Mines (see highlight under Activity 3.5 ASM Sector Policy).

GMP Team demonstrating how to re-use mercury efficiently

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HIGHLIGHT
Managing Environmental Health Risks in Ecuador:
Partnering with Universities and Canada's Development
Initiatives

Artisanal gold mining is the main profession of more than 60,000 people in Ecuador, who
often use significant amounts of mercury in addition to cyanide. In 2005, the Global Mercury
Project began a partnership with a project in Ecuador supported by the Canadian International
Development Agency, entitled "Sustainably Managing Environmental Health Risks in Ecuador".
The project is applying an ecosystem approach to health in strengthening core skills, knowledge-
exchange, and community empowerment to address environmental determinants of health in
selected regions of the country. The GMP has utilized its knowledge-base to contribute to this
project by developing training curricula on environmental management in mining, with emphasis
on mercury. These curricula are now being utilized by various university-community
development programs in Ecuador.
The project is based at the Center for International Health at the University of British
Columbia (UBC) and works with three main universities in Ecuador the University of Cuenca,
the University of Machala and the University of Bolivar - to establish capacity to sustainably
manage environmental health risks. In undertaking this challenge, partnerships were formed with
institutes in Cuba and Mexico to reinforce "South-South" linkages that can enhance sustainability
through regional networks of excellence. The project, which has received the BC Centre for
International Education Innovations Award, calls for multidisciplinary approaches to promote
institutional capacities and community development. Innovative training curricula were
developed to manage not only problems of mining contaminants, but also pesticide exposure and
vulnerability to vector-borne disease such as dengue and malaria. A series of problem-based
learning modules were developed, thus breaking down the barriers between universities and
communities and reinforcing local leadership through on-site community training. For the
modules on mining and the environment, emphasis is placed in two regions in the country -
Machala and Portovelo.
The national scope of the endeavor provides an exciting platform for building interregional,
intercultural and inter-university links as well. These elements reflect what the GMP has
contributed based on its experience in the six main GMP countries. Involving graduate and
undergraduate students from UBC as well as Ecuador's universities provides an invaluable
educational opportunity for integrating the lessons of the GMP into the knowledge and
capabilities of community learners and leaders. Partnership talks are further exploring how this
program could continue to develop in collaboration with Canada's Global Health Research
Initiative.

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