Analysis of Formalization Approaches in the Artisanal and Small-Scale Gold Mining Sector Based on Experiences in Ecuador, Mongolia, Peru, Tanzania and Uganda: Ecuador Case Study

Artisanal and Small-scale Gold Mining (ASGM) is one of the oldest and most traditional forms of mineral extraction in Ecuador. It emerged towards the end of the 1970s in Southern Ecuador’s Portovelo-Zaruma area, as result of two factors: the rising international gold price and substantial unemployment caused by the bankruptcy of the Compañia Industrial Minera Asociada (CIMA) that had been active in the Portovelo-Zaruma gold district. This area had been explored and developed from 1904 until 1950 by the South American Development Company (SADCO), when SADCO’s mining rights were transferred to CIMA.i In the 1970s, when CIMA went bankrupt, the miners fought to continue the mining operations. This new phenomenon generated a series of conflicts with government authorities who questioned the legality of the operations. Despite the conflicts, the miners organized into small groups and over the next 20 years, they produced roughly 42.5 tons of gold.