Gold-producing countries in sub-Saharan Africa should be well equipped to deal with increasing illegal mining activities in the coming months, according to research and analysis firm, BMI Research.
In a report titled Africa Mining Q318: The Four Key Themes, released recently, BMI lists illegal mining as one of the key themes that are likely to persist within the sub-Saharan African mining sector in the third quarter of 2018.
There are two factors that make gold an attractive to illegal miners. Gold is easier to extract through artisanal means and global prices have recovered. Currently, BMI foresees gold to average $1 300/oz in 2018, up from $1 250/oz in 2017.
To make matters worse, with rising level of unemployment, illegal mining has emerged as a viable source of income.
Noteworthy, governments are under resourced to deal with the problem of illegal mining, in which Amnesty International has reported that child labour is used in some African countries. Ghana is cited as one of the countries that illegal mining is likely to hit the most.
In South Africa, the struggle for lucrative territories in disused mines between rival groups has resulted in blood bath.
The BMI report mentions other themes as rising metal prices, mergers and acquisitions activity and new news restrictions.