PUBLIC PRIVATE PARTNERSHIPS

Kathleen CharlesSr. Investment Promotion ConsultantAccra, 29 September 2015

ELL is actively engaged…

• Specialist consultancy in Responsible Mining and Sourcing, serving global clients: Governments, Corporations, NGOs, MDBs, Donor Projects et al

• Mining Product Focus: coloured gems, diamonds, conflict minerals (3TG), jewellery, electronics, conservation

• One of the world’s leading ASM consultancies providing practical solutions to complex problems and challenges

• Impact ASM Livelihoods in more than 40 countries• Play key role in support of responsible mining & sourcing

initiatives• Fairtrade gold, Fairmined gold, Responsible Jewellery

Council, broad range of conflict minerals certification systems

ELL is a catalyst…

Stakeholder Engagement & Understanding

•Our work is informed & enriched by working for clients of different perspectives•We help clients forge new alliances with different interest groups•We understand context, risk and opportunity, and know how to develop practical solutions

Our Core Competencies

Sustainable Supply Chains

Community Engagement

ASM & the Environment

Mineral Sector Development

Conflict Minerals

Public Private Alliances to Formalize

ASM

State of Play in ASM Sector

f PLAY ASM AFRICA• Located in remote areas

• Weak Infrastructure

• High rates of Illiteracy

• Lack of incentives to Formalization

• Little or no access to Financial resources and training on business management

Role of Public and Private Actors

ASM FINANCIAL CHALLENGES

ASM NEEDS

•Flexible financial

tools

•Longer term finance

adapted to

production and

marketing cycles

•Loans on affordable

terms

•Business

Development

ASM CHALLENGES

•Collateral

Requirements

•Social Exclusion

•Financial Sector

Reluctance

•Weak infrastructure

MONGOLIA MINER

• “We do not have a long history of ASM

partnerships and I was a wild person with a

mask/hat in search of raiding areas to mine

gold. Everyone around me was disorganized

and local government gave us lots of problems.

Now we have an agreement with a mining

company and Government is facilitating….and

we work in a much more regulated fashion and

there are clear benefits to our organization”

Mongolian Miner

Government

f PLAY ASM AFRICA• Promote ASM disparate groups to form legal associations

• Provide designated areas for ASM exploration based on geological data

• Finance infrastructure (e.g. energy, roads, IT) and extension services

• Establish land use planning models & ownership transfer

• Work with FI/MFI to develop innovative finance solutions for ASM

• Explore credit guarantee schemes and develop financial products catered to needs of ASM

Private Sector

f PLAY ASM AFRICA• Formalize traders as well ASM

• Provide capital finance via buy/sell contracts

• Create Long Term Finance Vehicles, including leasing, risk insurance, CGS

• Explore joint ventures with donors/funders for BDS training and capacity building in business management ITCAM Ecuador Case

• Suppliers provide specialized Training (equipment maintenance, processing, management, environmental protection etc.)

• Create incentives for ASM to be liberated from debt bondage

Artisanal mining at Sharin Gol, Mongolia, 2014. © Estelle Levin Ltd.

Benefits of ASM Formalization Strategy

• Issuing special licenses for ASM• Access to market and

commodity data• Legitimacy and Stability• Potential to Access Capital via

Partnerships• Access to Fair Prices and Fair

Trade• Technical training and

Government Incentives• Risk Mitigation Measures

East and Southern Africa ASM Formalization Conference

How ASM Can Reduce Risk Thresholds of Financiers

• Formalization of Producer Groups – organization, entrepreneurship,

market preparation, articles of association, ability to commercialize

• Development of a Business Plan – management systems,

operational guidelines, governance and due diligence

• Facilitation of Strategic Partnerships

• Value Chain Management

• Attract interest in VC business proposition – Ecuador Portovelo

Recommendations for ASM Public-Private Cooperate Initiatives

f PLAY ASM AFRICA• Harmonize national and regional strategies to transform the sector

• Value addition – set up polishing and refining centers

• Create innovative financial solutions to complex financial bottlenecks

• Harmonize ASM formalization/national mineral care policies/objectives

• Encourage Fair Mining & Fair Trade certification

• Encourage NGO/Donors to support programs to sensitize ASM on benefits of legal trading venues, including training on business management et al

Examples of PPP in Africa

FRICA

• NATIONAL LEVEL the PP Alliance RESOLVE, Washington, DC

• INTERNATIONAL RCM Initiative ICGLR in Bujumbura, Burundi

• SUPRANATIONAL Global Initiative to Combat Illegal Minerals Trading

• REGIONAL SPATIAL Corridors to encourage investment in energy and agriculture. Mining to be also included

• EPZ, SEPZ and FTZ Worldwide PPP initiatives to attract strategic investors

ASM WOMEN Producers

Thoughts?