In May this year, we took a look at the current landscape of illegal mining. Today, we review the negative effects of this clandestine industry.
11 impacts of illegal mining on South Africa and the mining industry
- It costs taxpayers
By its illicit nature, the cost of illegal mining in South Africa is difficult to determine, but it is estimated to cost around R6 billion a year.
- It is a significant risk to health and safety
Damage to infrastructure poses a serious risk, while legal miners’ safety is threatened by illegal gangs that are usually armed, sometimes with AK47s (according to reports). Also of concern is some legal miners sell or give their clock cards to illegal miners to gain access to mines. There are even instances where legal miners provide:
- equipment, and
- mine property
to illegal miners.
Illegal mining can cause underground fires and fall-of-ground incidents, resulting in loss of life and threatening mine employees, mining communities and the illegal miners themselves.
- Illegal mining destroys the social fabric of mining communities
- It forces mining companies have to spend a significant amount of additional time and money on security
- It results in economic losses
This includes loss of tax revenue and loss of income for legal miners, as the illegal miners in effect compete with legal mining operations. Theft of machinery, diesel, tyres and other equipment is also a reality. The State and the mining sector lose approximately R7 billion per annum in revenue as a result of smuggling. In 2007, the loss in gold production due to stolen gold was estimated to be R5.6 billion, and illegal miners also steal thousands of litres of water to run these illegal mining activities.
- It relies on illegal channels to conduct its operations, which puts everyone at risk
Illegal miners may also illegally acquire explosives, diesel, copper cables and other equipment from mines and make illegal electricity connections from the mine’s electricity infrastructure. Any interruption of the mine’s electricity supply could create significant risks to the mine’s ventilation system underground and to the ability to hoist persons out from underground, particularly in cases of emergency.
- It increases the presence of prostitution in the area
According to reports, women go underground to work as prostitutes for illegal miners. This also poses obvious health and safety threats.
- It has a negative impact on the environment
Irresponsible mining practices cause irreparable harm to the environment and the ecology. Illegal miners tend to use extremely environmentally unfriendly refining methods and materials, which also put their health at grave risk.
- It increases loss of life
This is usually due to faction fighting between gangs, among illegal miners and fatal accidents, such as falls.
- Human trafficking increases
This is because the people used in illegal mining are from other countries, brought in to do the work. As we saw in our previous blog, it’s a multibillion-dollar transnational business empire with its own financial targets, line managers, security personnel and CEOs.
- It is a conduit for other criminal enterprises
This is because its proceeds are often used to finance other crimes.