impact of coronavirus (covid-19) · 2020. 6. 23. · obrajes, av. héctor ormachea, esq. calle 7,...

IMPACT OF CORONAVIRUS (COVID-19)ON ARTISANAL AND SMALL-SCALE MINING IN BOLIVIA

Solidaridad is an international non-profit organization with 50 years of experience at the global level that cooperates with all value chain players to become more resilient, sustainable and inclusive.

Cumbre del Sajama S.A is an organization with a social vision providing professional consulting, studies and training workshops for environmental, economic and social development for the extractive industry, with the aim of strengthening and maintaining a framework of mutual respect and raising living standards and productivity of those who are part of the mining activity.

Impact of coronavirus (COVID-19) on artisanal and small-scale mining in Bolivia

Cumbre del Sajama S.AObrajes, Av. Héctor Ormachea, esq. calle 7, Edificio Vera 1B.Tel: +591 227-87383Email: [email protected]

©SolidaridadAv. Roosevelt 5866, Miraflores. 15048.Tel: +511 442-4545Email: [email protected]

AuthorsEliodoro Sandi – Cumbre del Sajama S.A.Daniel Lafuente – Cumbre del Sajama S.A.

Copy editorMauricio Winkelried - Solidaridad

Editorial ManagementEditorial coordination: Diana Wu, Oscar Baldeón MontoroStyle editing: Alejandra VisscherDesign and layout: Johnny Morales

Edited bySolidaridadAv. Roosevelt 5866 – MirafloresLima, Peru

This publication has been possible thanks to the support of the Government of the Netherlands. The information and opinions contained in this document are sole responsibility of the authors.

INDEX

INTRODUCTION

GLOBAL HEALTH CRISIS

BOLIVIAN STRATEGY TO FACE THE CRISIS• Epidemic Containment Measures• Social Mitigation Measures• Economic Relief Measures

ARTISANAL AND SMALL-SCALE MINING IN BOLIVIA

PRELIMINARY ASSESMENT OF THE IMPACT OF THE HEALTH CRISIS ON ARTISANAL AND SMALL-SCALE MINING• Economic Impact• Social Impact

ASSESSMENT OF THE RELEVANCE OF THE GOVERNMENT MEASURES FOR ARTISANAL AND SMALL-SCALE MINING• Relevance of Social Mitigation Measures• Relevance of Economic Relief Measures

ASM CLAIMS DURING THE CRISIS• In the Traditional Sector• In the Gold Sector

MEASURES TAKEN BY THE STATE AND THE POSITION OF COOPERATIVES TOWARDS THE RESOLUTIONS ISSUED

WOMEN IN MINING: HIGH VULNERABILITY IN THE PANDEMIC• Women in mining within the traditional sector• Women members of gold cooperatives• Individual workers• Housewives in Mining

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INTRODUCTION

This document is prepared as part of the Qori Suma project which means “Good Gold” and is the combination of two words in Quechua and Aymara. This project has been supported by the Government of the Netherlands from 2016 to 2020, executed by the Mining Program of Solidaridad - the international non-profit organization, and the consulting firm Cumbre del Sajama. The Qori Suma project seeks to generate public policies that benefit the Bolivian gold sector through the promotion of spaces for dialogue where inclusive and sustainable reforms are developed at the environmental, social and labor levels.

The pandemic of the new coronavirus in Bolivia has caused a health crisis and a strong impact on diverse sectors of the economy, such as mining. This document exhibits a preliminary assessment of the impact of the pandemic and its effects on artisanal and small-scale mining (ASM) in Bolivia, in the economic and social2 fields. At the same time, it evaluates the relevance (convenience) of the application of the measures ordered by the government and gives some recommendations. Lastly, this document focuses on the problems faced by the subgroup of women miners, given their high vulnerability, presenting a diagnosis of their situation and needs.

1 Several of the relevant events described in this document are still in development, therefore, the information exhibited is the most current date as of the writing of this report.

GLOBAL HEALTH CRISIS

December 31, 2019 set a milestone in public health. On that date the Chinese government officially reported to the World Health Organization (WHO) the outbreak (appearance) of a new virus (from the coronavirus family) that quickly became an epidemic2 and later a pandemic due to its expansion on different continents, affecting the large numbers of people.

COVID-19 is the official name designated by the WHO to this infectious disease cause by the coronavirus, and is the acronym for “corona”, “virus” and “disease”, and 19 is for the year in which it was reported (2019).

To face the pandemic, most countries have designed a set of strategies such as:

i) mandatory total quarantine, which implies the confinement of the population with restricted measures to leave your house only for the provision of food and medicine,

ii) partial confinement only in certain geographic areas of the country,

iii) confinement reduced to certain periods during the day, and

iv) social distancing or voluntary isolation.

2 Disease that spreads for some time throughout a country, simultaneously affecting large numbers of people (Royal Spanish Academy).

IMPACT OF CORONAVIRUS (COVID-19) ON ARTISANAL AND SMALL-SCALE MINING IN BOLIVIA6

BOLIVIAN STRATEGY TO FACE THE CRISIS

Bolivia is facing the pandemic crisis from three perspectives3 :

• Epidemic Containment Measures• Social Mitigation Measures• Economic Relief Measures

Epidemic Containment Measures

The first two COVID-19 cases were reported in Bolivia on March 10, 2020 and immediately afterward, on March 12, the transitional government of interim President Jeanine Áñez decreed National Emergency, establishing a pause in educational activities and the suspension of flights from those countries affected by the pandemic.

With the spread of COVID-19 in Bolivia, a Supreme Decree No. 4196 was enacted on March 17, declaring national health emergency and general quarantine throughout the territory. Among the measures announced, the confinement at home goes from 17:00 to 5:00 hours, followed by closing its borders, suspending air, land and lake transport and the reduction of the working day from 8:00 to 13:00 hours.

3 Self-classification.

IMPACT OF CORONAVIRUS (COVID-19) ON ARTISANAL AND SMALL-SCALE MINING IN BOLIVIA 7

As of March 22, the current conditions became more severe. Through the Supreme Decree No. 4196, the total quarantine was declared, forcing the population to stay at home, with restricted hours where only one person per family is able to go out exclusively for food and medicines from 8:00 to 12:00, and with cars banning. Health, security and basic services personnel were exempted from these provisions.

At present, total quarantine restrictions in force are even more severe as of March 25 up to May 10. The new measures restrict going out for provisioning until 12:00 hours, but only once a week between Monday and Friday (control applied to the last digit of the identity card). Saturdays and Sundays are of total lockdown, except for those who provide emergency services. Hereinafter, flexibility is expected depending on the level of risk in each.

Social Mitigation Measures

Quarantine and compulsory lockdown have brought as a collateral effect an acute social problem, particularly for those who work in an informal sector, that is, in economic activities that are not fully visible in the Government’s registers for economic, regulatory or institutional reasons. The main characteristic of this population segment is that, in general, does not have fixed income or a salary subjected to regulation.

According to a recent study by the International Monetary Fund (FMI)4 for 158 countries, Bolivia has the proportionally highest informal economy (the analysis and indicators are based on the ratio of the informal economy with respect to the Gross Domestic Product – GDP). Thus, it is concluded that the countries with the highest informality in the world are Bolivia (with 62.3% of GDP) and Zimbabwe (with 60.6% of PBI), and that the countries with the lowest informal economy are Switzerland and Austria with 7.2% and 8.9% of its GDP, respectively.

Under a job quality approach5 it is stated that employment informality in Bolivia in people between 15 to 60 reached 67% of total employment in 2015.

These data show the reality of a large part of the Bolivian population that, due to the general stoppage of activities and not having a significant level of savings or any fixed income, is experiencing a strong negative impact on their family economy.

4 IMF, 2018. Shadow Economies all over the world: What did we learn over the last 20 years? Recovered from: https://boliviaemprende.com/publicaciones/fmi-publica-economias-sombrias-en-todo-el-mundo-que-aprendimos-en-los-ultimos-20-anos

5 Yañez, E. (2018). An approach to quality employment in (2006-2015). UNDP. Recovered from: https://www.undp.org/content/dam/bolivia/docs/undp-bo-analisis-del-empleo-en-Bolivia.pdf


To deal with this situation, the transitional government has designed and implemented a set of social mitigation measures whose target group is low-income families, although in some cases it reaches other population segments. These are the following measures:

• Electricity Tariffs Reduction: The State will pay the bills of electrical energy consumption for domestic use to households with a monthly consumption equal to or less than Bs 120 (roughly USD 17). In the case of higher consumptions, there is a graduated discount in force that fluctuates between 50%, 40%, 30% and 20%. The measure will be applied during the months of April, May and June (S.D. 4206).

• Cost reduction of drinking water and gas network services: The State will pay 50% of the drinking water and gas network consumption for all households during the months of April, May and June (S.D. 4206).

• Bond for basic food basket: It is a one-time financial support of Bs 400 (around USD 57.50) which applies to elderly people who do not receive a retirement pension, pregnant women or those who have children under 2 years, and people with disabilities (D.S. 4200 and Biministerial Resolution 001/2020).

• Bond for families: It consists of a one-time payment of Bs 500 (around USD 72) to families, for each child in preschool, elementary and high school of public and private education, and to young people and adults from the subsystem of alternative and special education (S.D. 4197, 4199, 4205, 4210, 4215).

• Universal Bond: It is a one-time payment of Bs 500 (roughly USD 72) addressed to all Bolivians from 18 to those under 60 years old who are not public servants or workers in the public and private sectors, do not receive a state pension and are not beneficiaries of the previously mentioned bonds (S.W. 4215).


Economic Relief Measures

In order to ease the financial situation of the different economic forces generated by the pandemic crisis, the government issued a set of legal provisions to comply with various economic sectors. A summary of these economic provisions is presented below and later, on pages 9 and 10, an analysis of the relevance (advisability) of their application to the artisanal and small-scale mining sector.

• Tax Flexibility: The payment of the Corporate Income Tax for the management closed as of December 31, 2019 is deferred until May 29, 2020, and payment facilities of up to three monthly installments are established, without maintenance of value and interest, nor security provision when the taxpayer pays 50% of the tax determined until before June 1, 2020.

• Deferral of credit payments: Financial intermediation entities must automatically defer the payment of repayments of credit to capital and interest, and other types of liens from the national credit system for the duration of the Coronavirus Pandemic National Emergency (COVID-19) and granting a maximum period of up to six months after the emergency declaration is lifted (Law 1294, S.D. 4206).

• Terms extension of the contributions to social security system: The terms of contributions to long-term social security system are extended both for employers, withholdings and independent taxpayers, as well as employer contribution to short-term social insurance.

• Deferral of FINPRO credit payments: The payment of installments corresponding to credits granted with resources from the Fund for Productive Industrial Revolution (FINPRO in Spanish), created by Law No.232 of April 9, 2012. FINPRO is intended for entrepreneurs who transform raw materials, among other recipients (S.D. 4207).

• Special program to support micro, small and medium enterprises: A fund of approximately USD 215 million (around Bs 1,400 million) is created, which will be applied to credits for micro, small and medium entrepreneurs under favorable conditions, with a 5-year term and 1-year grace period (S.D. 4216).

• Emergency plan to support employment and job stability: It is aimed at legally established companies and consists of granting credits through the financial system for an amount equivalent to two national minimum wages per worker and for a maximum of two months. The credits will be of concession nature, with a term of up to 18 months and 6-month grace period (S.D. 4216).


ARTISANAL AND SMALL-SCALE MINING IN BOLIVIA

Although there is no legal or technical definition of artisanal and small-scale mining (ASM), following standards used in the public sector and in the private and academic spheres, in this document the ASM will be understood as the segment consisting mainly of:

(i) mining cooperatives,

(ii) small private mining production units (to a lesser extent measure and commonly called “small miners”, whose incidence in total production es very low) and

(iii) informal individual miners.

In recent decades, the cooperative sector has become important due to it comprises an increasing number of cooperatives (around 2,034), which group 123,507 associate members. For their constitution, mining cooperatives must have a minimum of 10 associates and an unlimited number of associates. For policy analysis and definition purposes, we will classify mining cooperatives as gold and traditional.


Traditional mining cooperatives operate mainly in the west (Potosí, Oruro, La Paz) and exploit deposits of tin, wolfram, antimony, bismuth and lead-silver-zinc complexes; most of them in deposits of the Bolivian Mining Corporation (COMIBOL). In many cases, several cooperatives operate in the same deposit such as Cerro Rico de Potosí, San José, Viloco and Siglo XX. A minimum proportion of traditional cooperatives have their own processing plants, which is why a large part of them sell their mineral production to processing plants.

The gold mining cooperatives are located mainly in the north of the department of La Paz and in the Eastern departments of Beni, Pando and Santa Cruz. This segment is divided in two types of operations:

(i) alluvial gold cooperatives that operate secondary deposits in river beds, old channels, river banks, platforms and terraces, and

(ii) the gold cooperatives that operate primary deposits, mostly filonian rocks, and exploit both surface and underground mining.

Due to the nature and objectives of the Qori Suma Project, this document will primarily refer to ASM in the gold sector.


6 The current price on February 29,2020 was taken as a reference, and it was estimated that the production costs, deductible from the gross value, reach 50% in global average. It is assumed that the stoppage of activities due to the pandemic will last 2 months.

PRELIMINARY ASSESMENT OF THE IMPACT OF THE HEALTH CRISIS ON ARTISANAL AND SMALL-SCALE MINING

Economic Impact Given that there are no disaggregated production records in the cooperative mining sector, in order to estimate the economic impact of the stoppage in traditional mining cooperatives production, we considered, on an aggregate basis, the average bimonthly production of the main metals produced by cooperatives was taken based on the official data published by the Ministry of Mining and Metallurgy in the third quarter 20196.

Likewise, the price in force on the last day of February, 2020 was taken as a reference and it was estimated that the producing costs deductible from the gross value reach 50%, on average worldwide. It is added that the stoppage of activities because of the pandemic will last two (02) months.


FMT: fine metric tons PA: pound avoirdupois (libra fina, in Spanish) TO: troy ounce

Source: Own preparation based on official information

Estimate of the impact of economic stagnation on traditional mining cooperatives

In summary, the above information shows that the economic impact (or loss) after the stoppage of activities in traditional mining cooperatives due to quarantine is estimated at approximately USD 25 million.

In the gold mining cooperatives section, an aggregate analysis is not pertinent. This is mainly due to the fact that, in the absence of production periodic reports of cooperatives, the production calculation of the Ministry of Mining and Metallurgy could be overpriced, since when carried out by indirect methods – using exports and domestic sales as the basis source -incorporate production of unknown sources.

These sources could belong to informal/ illegal miners or companies and even to illegal imports that are incorporated into the legal sphere during the commercialization process.

Ore Production up to the third

quarter of 2019 (FMT)

Average bimonthly production

(FMT)

Price on02/28/20

Gross production

value(millions of USD)

VNet production

value (millions of USD)

Zinc 58,181 12,930 PA 0.92 26.23

Tin 1,639 410 PA 7.35 6.64

Silver 145 24 TO 17.19 13.26

Wolfram 1,005 168 FMT. 13.234 2.22

Lead 8,693 1,449 PA 0.85 2.72

TOTAL 51,07 25,53


Therefore, the methodology for estimating the economic impact of the stoppage in gold ASM activities is based on the following assumptions:

• The estimate is carried out by type of operation.• Model operations are included for each case, both in cooperatives and other types

of operations. • Production has been estimated based on previous studies and consultations with

specialists and actors in the sector.• The reference price for value calculation is the price in force on the last business day

of February.• To go from the gross value to net value, the average deduction taken is 35%, which is the

one recorded by the National Service for Registration and Control of Commercialization of Minerals and Metals (SENARECOM) in its referential settlements.

• The aforementioned deductions refer to expenses from smelting, laboratory, insurance and transportation, commissions, mining royalties, contributions to health insurance and federations.

• The stoppage of activities due to quarantine will last 2 months.

Source: Preparation based on production estimates made by specialists.

Estimate of the economic impact on the stoppage of activities in gold ASM

The table above summarizes the economic impact per each month of the stoppage of productive activities for each type of operation in gold ASM. Assuming that the interruption of activities will last 2 months, the previous amounts must be multiplied by two in each situation. In this respect, considering the methodology used, it is estimated a total loss of USD 3’087,280.

Type of product

Average monthly

production

Price on02/28/20USD/ TO

Gross value(USD)

Production Costs and

deductions

Net worth(65%)(USD)

Small cooperative

4 kg 1,626.35 210,000 35% 136,500

Medium cooperative

10 kg 1,626.35 525,000 35% 341,250

Large cooperative

30 kg 1,626.35 1,575,000 35% 1,024,000

Tailing Pond 110 g 1,626.35 5,750 35% 3,740

Dredgers 1.1 kg 1,626.35 57,500 35% 37,000

Carranchas7 22 g 1,626.35 115,000 35% 1,150

7 Informes oficiales de FECOMAN y FERRECO, y entrevistas realizadas por Cumbre del Sajama a sus dirigentes.


Social Impact

This section refers only to gold ASM because, due to communication difficulties during the quarantine period, the survey was conducted exclusively with leaders of this sector given the relationship built within the Qori Suma project framework8.

The social impact caused by the health crisis and the subsequent quarantine can be summed up this way:

• The Federation of Gold Mining Cooperatives (FECOMAN) reports that all its affiliated cooperatives have suspended their activities, while few others part of the Regional Federation of Auriferous Mining Cooperatives (FERRECO) continued their operations while they had fuel (diesel) and other basic supplies as explosives; then, they halted their operations as well.

• As a result of quarantine, there is absolute shortage of fuel and supplies. • Although the production and commercialization activities are suspended, some

collection tasks are being carried out by individuals and illegals. • The exploitation zones are being protected by the changing of groups of guards from

each cooperative. Only authorized personnel are allowed to enter (doctor, nurses, staff for food and gas provision, etc.).

• The rest of the staff is in quarantine.• Compliance with the stoppage of activities has occurred as a consequence of the

supreme decrees enacted during quarantine, but also for fear of contamination.• The situation is extremely critical, particularly for small cooperatives. • The impact on income leads to a low capacity to provide basic goods, mainly food.• Food supply is primarily in local and zonal markets. • A smaller proportion of gold cooperative members use their savings, although the

vast majority do not have one.• The member’s lack of information and knowledge about coronavirus is obvious.• There is a great lack of biosafety equipment.• Because of the crisis, some prevention measures are being taken at the local

community level.• Many members of the gold cooperatives have returned to their communities or

camps to stay in quarantine. • Different members chose to spend more time on agricultural activities. • It is noted that quarantine has caused stress in most families.• There is consensus that quarantine must be followed to overcome the pandemic.• Most people consider and are concerned about the fact that if a possible contamination

occurs, they would have to go to hospitals in La Paz or other cities. It is estimated that local hospitals and delegated insurance hospitals are not adequately equipped nor they have trained health.

8 Official reports from FECOMAN and FERRECO, and interviews made by Cumbre del Sajama to their leaders.


ASSESSMENT OF THE RELEVANCE OF THE GOVERNMENT MEASURES FOR ARTISANAL AND SMALL-SCALE MINING.

Next, we present an evaluation of the social and economic measures ordered by the government that reflects surveys, public statements and conversations with opinion leaders in this mining sector.

Relevance of Social Mitigation Measures The social mitigation measures ordered by the government to mitigate the effects of quarantine are focused on four target groups:

i) families with children of school age (preschool, primary and high school),

ii) low-income families,

iii) Bolivians who do not have fixed incomes as public servants, land leasing or dependent workers in the private sector, and

iv) households that access basic services.


• Tax flexibility: The payment of the Corporate Income Tax for the management closed as of December 31 does not reach the ASM because mining activities have a different fiscal management, which begins on October 1 and closes on September 30, with a deadline for payment expiring on January 31, 2020; therefore, the legal provision issued does not apply.

• Deferral of credit payments: ASM units do not normally access loans within the regular financial system, mainly because of the stringent conditions required in terms of guarantees, cash flows, low levels of risk, etc. Therefore, this measure does not apply either.

• Terms extension of the contributions to social security system: The terms of contributions to long-term social security system are extended both for employers, withholdings and independent taxpayers, as well as employer contribution to short-term social insurance – it does apply.

• Deferral of FINPRO credit payments: This deferral is intended for entrepreneurs who transform raw materials. Therefore, it does not apply.

• Special Program to support micro, small and medium enterprises: The definition of micro, small and medium-sized companies in Bolivia is established in Law No. N° 9479 based on the number of employees. As a legal regulation, mining cooperatives do not have employees, therefore, this measure does not apply to ASM.

• Emergency plan to support employment and job stability: This plan is aimed at legally established companies. Since mining cooperatives are not companies, they cannot benefit from this plan. Therefore, it does not apply either.

In this context, artisanal and small-scale miners fit into the four target groups described. Therefore, those who have school-age children benefit from the School bond of Bs 500 per child, will be also favored by the Bs 400 bond for basic food basket, and those who do not access the previous bonds can receive the Bs 500 Universal Bond.

At the same time, small-scale artisanal miners, as heads of households consuming basic services, are accessing (for three months) the phased reductions based on the consumption of electricity tariffs and the 50% reduction on the drinking-water and gas network consumption fees.

Relevance of Economic Relief Measures Unlike the mitigation measures for families that fully reach the ASM sector, the other legal provisions addressed to productive units or economic actors have very little impact on the artisanal and small-scale mining sector.

9 Micro and Small Enterprises Regulation.


ASM CLAIMS DURING THE CRISIS10

Below, we present a summary of the demands that have been taken from the official statements of the federations and from letters sent by themselves to the central government.

10 Demands made in April, 2020.


• Postpone the payments, reschedule debts and modify credit conditions with FOFIM and private banks.

• Eliminate the collection of bills for electricity consumption in mining camps during the months of April to June 2020.

• Create job coupons11.• Provide support for the implementation of the Reactivation Plan for Gold Mining

Cooperatives (PRCMA), which includes: i) strengthening institutions related to the sector; ii) comprehensive technical assistance for mining exploration, cost reduction and technological development; and iii) regulatory development and management favorable to the sector.

• Approve the proposal of a supreme decree for the restart of mining activities presented by FECOMAN to the central government, which establishes: i) to authorize the restart of activities of gold cooperatives and allocating 40% of external cooperation of State funds aimed at facing the effects of COVID-19 to support this sector; and ii) to approve the execution of the PRCMA by the Ministry of Mining and Metallurgy, and the Ministry of Economy and Public Finance.

In the Gold Sector Regional Federation of Gold Mining Cooperatives from the North of La Paz (FECOMAN)

In the Traditional Sector National Federation of Mining Cooperatives of Bolivia (FENCOMIN)

11 In the middle of year 2000, cooperative miners managed to get the State to give them productive employment coupons (which were non-transferable values) for the delivery of physical production of minerals, granted and redeemable exclusively by COMIBOL.

• Incorporate the mining cooperative system in social and economic measures, considering that mining cooperatives are non-profit self-managed social and economic institutions.

• Review and/or suspend the payments for electricity contracts that mining cooperatives have, for the duration of the health emergency and total quarantine determined by the government.

• Authorize the provision of inputs in order to restart the mining activity (explosives, fuel and others), considering that mining cooperatives are self- managed social institutions that need to work to produce revenues for each of their associates.

• Prepare a contingency plan to support the management of the mining productive sector. The plan must create a Mineral Pricing Stabilization Account (Cuenta de Estabilización de Precios de Minerales, CEPREM) and determine the sources of financing and purpose of the resources, the beneficiaries and the State entity that will manage the resources.

• Authorize the import of inputs, tools, fixtures, equipment and machinery for mining activity with zero tariff.

• Reschedule and defer until the year 2021 the payments to be made by mining cooperatives to the banking system, the health system, the Pension Fund Administrators (AFP), the National Tax Service (SIN), the Fund for Mining Financing (FOFIM), the Jurisdictional Mining Administrative Authority (AJAM), the Bolivian Mining Corporation (COMIBOL) and product of environmental resolutions.


• Reduce wages in the public sector and allocate the resources saved to face the health crisis in the country.

• Reschedule the debts of mining cooperatives with FOFIM.• That Yacimientos Petrolíferos Fiscales Bolivianos (YPFB) and the National

Hydrocarbons Agency (ANH) authorize the sale of fuels to mining cooperatives.• Establish flat rates for the mining cooperative sector with a 50% discount with

respect to the current values.

• Allow mining cooperatives to restart their exploitation work and guarantee the supply of fuel, inputs and essential products in mining camps.

• Likewise, guarantee the non-interruption of the gold production chain for the commercialization of minerals and concentrates in order to avoid a catastrophic economic crisis in the cooperative sector.

• Take proper measures so that mining cooperatives that ceased their production are exempt from paying electricity for the duration of the declaration of health emergency.

• Take alternative measures facing total quarantine to stop COVID-19, such as the provision of biosafety material and equipment in health centers from the mining camps for possible detection and care of those infected.

• Provide that the bond for basic food basket benefits members of our cooperatives and benefits those who do not have a monthly income.

Regional Federation of Auriferous Mining Cooperatives (FERRECO)

La Paz Departmental Federation of Mining Cooperatives (FEDECOMIN LA PAZ)


MEASURES TAKEN BY THE STATE12 AND THE POSITION OF COOPERATIVES TOWARDS THE RESOLUTIONS ISSUED

The Ministry of Mining and Metallurgy has ordered provisional measures so that the sector can reactivate mining operations. Among the measures announced are:

(i) the creation of virtual platforms to do mining procedures via Internet;

(ii) the empowerment of a free line for consultations (mainly on legal procedures, permissions and authorizations, and NIM of mining operators);

(iii) free access to the Mining Identification Number (NIM) until July 15;

(iv) the delivery of 80 tons of food for the most impoverished families in Potosí;

(v) the collection of economic recourses for the delivery of work material for the restart of operations in the most vulnerable mining sector and

(vi) the extension of the validity of the Mining Identification Number (NIM) until May 3113.

12 Up to May 6, 2020.

13 The Pricing Stabilization Account (CEPREM), established through S.D. 29769 of October 29, 2008, sets average prices, that is, in periods of low prices, the fund compensates cooperatives, but when mineral prices are above average to high, cooperatives must replace the fund with the difference.


By means of Multiministerial Resolution 01/2020, on Friday, May 1, the government authorized the mining cooperatives, private and state mining to restart their productive work from May 2, under biosafety measures to prevent the spread of coronavirus disease.

Cooperatives must submit a biosafety protocol to the competent authorities and request authorizations for transportation of minerals and metals in accordance with the regulations. All production units must install disinfection chambers and have the necessary equipment for temperature measurement and control of mining workers.

They must also implement mobile hospitals, apply temperature tests to dismiss heart disease, diabetes and cancer.

The federations, both traditional and gold mining, have not yet agreed on how to deal organically with the reactivation of activities because they would not have the mandatory biosafety conditions to work during quarantine for COVID-19; reason why they have declared in emergency.


WOMEN IN MINING: HIGH VULNERABILITY IN THE PANDEMIC

The studies performed within the framework of the Qori Suma project on women in mining consider four groups of women miners:

(i) women in the traditional sector,

ii) women members of gold cooperatives,

iii) individual workers and

iv) housewives in mining.

This section will follow this classification and will seek to reflect the feelings of women facing the pandemic, for which the opinion of the four groups was gathered in telephone interviews with woman leaders and grassroots women in mining.


Women in mining within the traditional sector Women in this sector acknowledge general information (obtained from television) about COVID-19 and its lethal effects. They do ignore how to deal with a possible contamination, the required protocols and the health centers to assist in case of an emergency (they assume they should go to the centers of the National Health Fund).

The activity of this sector is totally paralyzed, since at the beginning there was a certain violation of quarantine but there were fines to offenders.

This group does not have the financial resources to face the crisis, some of them because their husbands are farmers or have another occupation that is suspended due to quarantine; or because they are widows, divorced or single mothers (the majority).

With regard to the food supply situation, women in this group maintain that they have been subsisting on the provisions they had in store, but since they ran out of them, they consider that the situation will be much critical from now on.

Regarding the social benefits established by the government, these women consider that they are being discriminated. Benefits such as the bond for basic food basket and universal bond are aimed at people who do not have a dependency relationship and, therefore, do not contribute to the social security system, while cooperative members do maintain long-term contributions to social security, which it is only partially true.

Their main concern is the immediate restart of their operations because many mines are flooded and it is urgent for them to have financial resources.


Women members of gold cooperatives Members of gold cooperatives have basic knowledge about coronavirus, information acquired from local radios and social media, and in some cases, from television when they inhabit larger towns. They admit to know nothing about protocols in case of a possible contagion.

Quarantine has caused economic losses in different degrees. Those who depend exclusively on gold activity are the most affected as operations are normally suspended from December to February, this is why operations should be restarted from March. For the group of women who have some other economic activity, revenues from other sources or a husband who is indeed receiving income, the crisis situation becomes more tolerable.

With reference to the provision of food, the women in gold mining who live in El Alto have a normal supply, while the women members who are in the communities – specially in communities far from the most important population centers in rural areas – find themselves in a critical situation.

The greatest requirement they claim is support to restart mining operations, particularly by the provision of fuel and explosives. They intend to restart their activities during the first days of May, they even affirm that, if the quarantine is extended after April 30, this sector may not comply with the measure due to the economic damage caused.


Individual workers In this group we find the barranquilleras14 , women who carry out their gold extraction work in the rivers of the northside of La Paz, and bateadoras15 (gold panner), who carry out the same work in the department of Santa Cruz.

These workers maintain that they only have very basic information about coronavirus, which comes from radio and television. They are afraid to become infected and recognize that they lack knowledge of health protocols to avoid contagion.

Currently, most women are complying with the quarantine, although some continue working, driven by the need to have economic income, especially those with many children.

The barranquilleras and bateadoras admit that the main problem is lack of food. Many of them suffer critical and, in some cases, extreme conditions; this is why, they are working in domestic agricultural activities and raising farmyard animals. They are still skeptical about the bonds announced by the government, fearing that it will not benefit them all.

14 N.T.: woman who recover gold by rinsing sand from rivers, using washing pan, shovel, crowbar and, occasionally, quimbalete.

15 N.T.: women who also recover gold from river sand


Housewives in Mining This group reflects the situation and perceptions of housewives in mining, that is, the wives of miner workers who, although they do not perform mining work, share the problems of mining households.

Like the other groups of women, their knowledge about the pandemic and its effects are general, they get the information through the most popular media: television. They admit to know very few about prevention protocols and in case of a possible contagion at home.

All housewives in mining comply with quarantine, since they are the wives of company workers and were obliged to stop their activities. They say isolation causes fatigue and stress, mostly in children, because confinement, the discomfort of their homes and the impossibility of doing recreational activities are producing emotional issues in kids.

In relation to food supply, so far, they have been using provisions from their grocery stores or companies’ supply means, although they fear that when this runs out, problems may arise.


CONCLUSIONS AND RECOMMENDATIONS

Some conclusions and recommendations emerge from the above:

• Although the social mitigation measures to face the crisis reach the artisanal and small-scale mining sector (ASM), as households, the regulatory provisions for economic relief aimed at the productive sector are not applicable. Therefore, it is necessary to design specific policies for this sector.

• In the traditional ASM, besides the suspension of operations – which is temporary – the greatest problem is the decrease in prices of the base metals they produce, as a consequence of the global recession of the industry.

• A good option to support traditional cooperatives is to replace the Price Stabilization Account (CEPREM), established by Supreme Decree No: 29769 of October 29, 2008 with average prices. However, this price stabilization fund should function comprehensively as it was originally designed, meaning that in periods of low prices the fund compensates cooperatives, but when the mineral price is above average, cooperatives must replenish the fund with the difference.


16 This is a common macroeconomic effect to observe in the gold commodity. In uncertain times, it is safer to invest in gold reserves (which is a valuable, scarce and multipurpose metal), tan to invest in shares of oil companies that, for example, have been strongly affected by this situation of global stagnation. For more information, click here: https://www.eleconomista.com.mx/mercados/Menor-apetito-por-el-riesgo-impulsa-precio-del-oro-20200504-0118.html

• In the ASM from the gold sector, the price is not a problem. Its price in the international market is on the rise, boosted by the already latent world crisis where the economic agents tend to seek refuge in this metal16.

• In the gold sector, the issue is limited to the stoppage of activities, which creates a high economic impact, and the lack of fuel and supplies. Thus, is important for the government authorities to consider the gradual, planned and controlled restart of gold activity.

• In both groups, the restart of operations needs to be established, as well as having specific protocols for prevention and care of those infected, which must be mandatory and a requirement for the continuity of activities.

• With regard to the issue of women in mining, it is recommended that special assistance programs be stated for the most vulnerable groups, such as barranquilleras and bateadoras.

• The National Network of Women and Mining and its organizations consider important to request support from international cooperation and the media to channel aid. This help should be focused on directing the purchase of basic food baskets and biosafety instruments for women in emergency, and on supporting the identification of domestic violence cases.


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impact of coronavirus (covid-19) · 2020. 6. 23. · obrajes, av. héctor ormachea, esq. calle 7,...

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