Artisanal gold and transformational exchange: toward a public–private partnership in Tanzania

Buying into formalization? State institutions and interlocked markets in African small-scale gold mining

“…He considers the illegality of most ASM activities to be a major problem. The argument, however, becomes somewhat unclear and circular but for reasons of space we cannot pursue the issue further although we concede with [28] that fair trade initiatives only address the formal part of the ASM gold chain. So far the most advanced initiative to certify minerals is the standard for fair traded gold and associated precious metals developed by the Alliance for Responsible Mining (ARM) and the fair trade umbrella organization Fairtrade Labelling Organizations International (FLO) [1].…”

“…In contrast to these two entry points, Imparato [28] argues that intervention downstream in the buyer segment of the chain will facilitate formalization upstream in the production segment. Empirically the argument is based on historic incidences in Eastern Europe and a study of the operations in Tanzania of the African Precious Metals Ltd. (APM), a subsidiary of FBME Bank.…”

“…Between 2006 and 2009, the APM established five gold buying offices in the area south of Lake Victoria where the company bought gold from people who could document that it was legally obtained. 3 Based on what is presented as a successful organizational set-up, Imparato [28] proposes a Public-Private Partnership (PPP) between one or more private banks and a government agency (preferably under the Ministry of Energy and Minerals). The PPP would be purchasing legally extracted gold throughout Tanzania, thereby encouraging ASM operators to formalize their mining activities in order to access the services of the gold buying offices.…”

“…. .wherein a set of business transactions substantially affect societal expectations, modifies behaviour and promote sustainable mechanisms'' (Imparato, 2010: 462) A PPP, according to Imparato [28] offers a lot of advantages:…”

“…The next section addresses these issues in Tanzania 3 Today the APM only carry out buying operations from the main office in Mwanza City. 4 Fair trade as an alternative to the PPP is rejected by Imparato [28]. He considers the illegality of most ASM activities to be a major problem.…”