Usukh Asm In Mongolia


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Usukh Asm In Mongolia

  2. 15. Assessment of Mineral Policy Development –with a Focus on ASM in Mongolia CASM Conference, Brasilia Batsaikhan Usukh Coordinator, Sustainable Mining Project MRPAM and SDC Mongolia
  3. 16. Framework for the Presentation <ul><li>Introduction to the SAM </li></ul><ul><li>Observation on Mineral Policy Reform and Development </li></ul><ul><li>ASM Policy Reforms and Development </li></ul><ul><li>Assessment on ASM Policy </li></ul>
  4. 17. Introduction to SAM <ul><li>Goal </li></ul><ul><li>Contribution to the responsible ASM </li></ul><ul><li>Objectives </li></ul><ul><li>Support to legalisation of ASM </li></ul><ul><li>Support to Institutional development </li></ul><ul><li>Improvement of economic profitability of ASM </li></ul><ul><li>Environmental Improvement </li></ul>
  5. 18. Observation on Mineral Policy Reform and Development <ul><li>The government accepted that the mining sector is the key to the country’s development </li></ul><ul><li>Gold program was passed in 1992 </li></ul><ul><li>First mining law was approved in 1994, and revised several times (1997) and three times in 2006 – regulates large scale mining activities </li></ul><ul><li>Tax on minerals (10%) with various fees – use of minerals, land and water </li></ul>
  6. 19. Observation on Mineral Policy Reform and Development <ul><li>Policies that stimulate foreign investment </li></ul><ul><li>– Gold program 1992 </li></ul><ul><li>- Better tax environment (no tax for first 5 years) in investment agreement </li></ul><ul><li>Ensuring a reasonable return to the national economy (1 ounce >500 US$) while supporting investors with lower tax (stable socio-economic-political situation) </li></ul><ul><li>- Windfall tax in 2006 </li></ul><ul><li>- Government of Mongolia > 51% and investor 49% for strategic deposits </li></ul>
  7. 20. Observation on Mineral Policy Reform and Development <ul><li>How policies that simulated foreign investment were made in the 1990’s </li></ul><ul><li>- dominated with communist mentalities </li></ul><ul><ul><li>- No need to debate all over the country </li></ul></ul><ul><ul><li>Government set the goalsand developed the policy </li></ul></ul><ul><ul><li>People were not interested in participating because of ownership issues </li></ul></ul>
  8. 21. Observation on Mineral Policy Reform and Development <ul><li>Ensuring a reasonable return to the National Economy </li></ul><ul><li>After around ten years of transition (by 2000) the mentality of people has changed - so how is policy being made nowadays? </li></ul><ul><ul><li>- learning lessons </li></ul></ul><ul><ul><li>- Media, (TV / newspapers) and civil movements express voices of the people </li></ul></ul><ul><ul><li>- Government starts to understand </li></ul></ul><ul><ul><li>- More focus on strategic deposits </li></ul></ul>
  9. 22. Policy Development Process Policy Makers / Government Media Civil Movement NGOs People Citizens Less Debate Missing Part What is needed: donors voice strong NGOs
  10. 23. ASM Policy Reforms and Development <ul><li>The sub-sector emerged in the mid 1990’s / no attention given to the sub-sector </li></ul><ul><li>Because of damage in protected areas, the government started to intervene in ASM activity from 2004 (Res #87, to eliminate) </li></ul><ul><li>Due to the risk of mercury use without control, one more provision was added into the criminal law (crime against the nature and human wellbeing). </li></ul>
  11. 24. ASM Policy Reforms and Development <ul><li>The first law was drafted in 2003 and 2006 </li></ul><ul><li>No approval of the law </li></ul><ul><li>MAIN DOCUMENTS </li></ul><ul><li>Resolution 28 on Regulating ASM (Jan 2008) </li></ul><ul><li>Sub program on the development of ASM – 2015 (Feb 2008) </li></ul><ul><li>Temporary regulation on ASM (Feb 2008) </li></ul>
  12. 25. ASM Policy Reforms and Development (Draft Laws) <ul><li>The following steps have been taken: </li></ul><ul><li>Study tour to China and South American countries </li></ul><ul><li>Extensive field trips to ASM sites </li></ul><ul><li>Law was drafted and debated throughout the country (workshops, stakeholder meetings, field trips with policy makers </li></ul><ul><li>Necessary studies were conducted </li></ul><ul><li>SAM project facilitated communication between different stakeholders </li></ul>
  13. 26. ASM Policy Reforms and Development Temporary Regulation (TR) <ul><li>Copy of already draft law (good) </li></ul><ul><li>However the TR was: </li></ul><ul><li>Not well planned in advance, urgently made in response to problems </li></ul><ul><li>Very short time given to policy makers </li></ul><ul><ul><li>Therefore no debate conducted </li></ul></ul><ul><li>No multi-stakeholder participation </li></ul><ul><li>But luckily copy of already drafted law </li></ul>
  14. 27. Assessment on ASM Policies (Advantages) <ul><li>Defined long term program for ASM in Mongolia (accepting ASM as an activity) </li></ul><ul><ul><li>Organising informal miners into miner-user groups </li></ul></ul><ul><ul><li>Legalising ASM sub-sector </li></ul></ul><ul><ul><li>Reduction of unemployment and poverty </li></ul></ul><ul><ul><li>General shape of the documents is good </li></ul></ul>
  15. 28. Assessment on ASM Policies (criticisms) <ul><li>Centralized experimental plants of hard rock –gold ore processing (questions – who owns it, how big should it be – trials) </li></ul><ul><li>ASM-ers must be organised into unregistered partnerships (these are not flexible, limiting alternative forms of legal entities) </li></ul><ul><li>Land allocation: classifying them as secondary miners </li></ul>
  16. 29. Assessment on ASM Policies (Criticisms) <ul><li>Economic activity rather than mining activity (no mining rights) </li></ul><ul><li>Human rights issue (pregnant women and mothers with younger kids are not allowed to work at mining sites, </li></ul><ul><li>ASM exploit only what is infeasible to other mining activities </li></ul>
  17. 30. Assessment on ASM Policy <ul><li>Temporary regulation (TR) is effective until the new law is approved </li></ul><ul><li>Feedback on the TR must be reflected in the new law (advantage). </li></ul><ul><li>Assessment of TR must be completed by the end of this year </li></ul><ul><li>Inputs of international and national experts as well as feedback from the field are needed </li></ul>
  18. 31. <ul><li>Thank you very much for your attention </li></ul>