Zama zamas are just the visible tip of a massive, largely invisible mining value chain

The Southern African Development Community (SADC) is generally categorised as a low- to middle-income region and economic zone. Such a region tends to exhibit extensive income stagnation, high inequality, an increasing population growth rate and a large number of people living in poverty. 

These harsh socioeconomic conditions faced by the people of SADC and those from other parts of the continent are incentive enough to illegally enter and end up in the belly of South Africa’s abandoned mine shafts as zama zamas, which loosely translated means “chance takers”. These chance takers, according to the Mineral and Petroleum Resources Development Act and Precious Metals Act, illegally acquire, possess or dispose of precious metals.

This lucrative illicit industry is estimated to cost the South African state R21-billion in lost tax revenue annually and R14-billion in gold production, with an estimated 10% of the gold produce destined for foreign markets, according to the EU’s Enact programme, a partnership between the Institute for Security Studies and Interpol, in affiliation with the Global Initiative against Transnational Organized Crime.

That is just the direct economic cost without the addition of infrastructure damage, such as the recurring sinkholes on Snake Road in Benoni on the East Rand, damage to water infrastructure, as water is critical in the production process, the cost of additional state resources required to curb the crime, and other social and economic costs.

An ordinary mining operation — a mine-to-market value chain — would flow from mining, processing, management of inventory and transportation to the market from where finished products will be manufactured for the end user, the consumer.

The same happens in this parallel economy of zama zamas — however, the public, mining houses and the state, in particular, have placed their sole focus on just the mining activity in the value chain. But this is an industry with suppliers of explosives, security, arms, gas tanks and other inputs in production that are either primary or support the process.

There is big money circulating.