Gold Trading Networks and the Creation of Trust: A Case Study from Northern Benin

Abstract

The paper provides insights into an illicit trading system and explores the logics that contribute to its proliferation. It joins the literature on informal trading networks and revises conventional wisdom about what is necessary to sustain them. Gold traders have established intricate webs of relations based on personal dyadic affiliations. These extended networks are very heterogeneous, involving a multitude of actors, spanning regional, ethnic and social categories. Unlike many other examples in the anthropological literature, the gold trade is not a business carried out by members of a single ethnic group. Yet, explanation is required as to why, despite this heterogeneity, confidence between all actors is created, particularly in this case where there is no legal recourse when informal contracts are broken. I argue that a patron–client system of risk-sharing at various economic levels is the basis both for economic rationales and cohesion among all actors.

Buying into formalization? State institutions and interlocked markets in African small-scale gold mining

“…Evidence from these countries is irrefutable: ASM operators would like 'to be formalized' -but not at any cost. When they sell their gold they consider 1) the local gold price offered, 2) the informal operational loans they may have received from gold buyers, wherefore they have to sell their gold to these gold buyers at reduced rates, and 3) the degree of local law enforcement to circumvent in case the illicit marketing channels offer better prices [34,42,16,18,24].…”

“…This is why the PMMC Tarkwa branch aspires to resume its policy of lending out amounts of 10,000-30,000 GHS to trusted licensed buying agents in order to increase the quantities of purchased gold. Some figures 16 will serve to illustrate the situation: 1) The gold prices offered by four Tarkwa-buyers were between 3.3 and 5.2 per cent below the world market price (the percentage decreasing with the size of the buyer). An Indian buyer who purchased between 20 and 40 kilos a month mainly from other buyers and agents offered the price closest to the world market price.…”

Agriculture and Artisanal Gold Mining in Sierra Leone: Alternatives or Complements?

“…Concurrently, gold miners may bring the market for agricultural products to rural farmers, contributing to the earlier mentioned spontaneous decentralisation of market centres and proto‐urbanisation, which might lead to the development of activities that outlast short‐lived mining activities. Experiences in Sierra Leone and other countries have shown that mining areas attract traders and service deliverers that profit from miners as consumers (for example Riddell, ; Grätz, :13; Maconachie and Binns, ; Werthmann, :116) . Although today, large quantities of imported rice are brought to remote mining areas, farmers producing rice close to mining areas could satisfy this demand (Richards, :48–52).…”

Mining

“…In the nineteenth century, these rushes created a mobile population (Belich 2009: 306-20), which developed its own unique norms. Something akin to this occurs in some ASM communities today, for instance in West Africa, where miners establish their own novel social networks to mine, buy, and sell minerals (Grätz 2004(Grätz , 2013. Contemporary gold camps are sometimes considered places of sexual excess and prostitution, as the nineteenth century camps were, but evidence from East Africa (Bryceson et al 2014) and Indonesia (Mahy 2011) indicates that emergent forms of sexuality may free women from traditional roles and offer them avenues for agency that may be more be more beneficial and less exploitative than we might at first suspect.…”