Women as change agents: sustainable ASGM through Women’s Cooperatives in Indonesia
By Anupama Ariyaratne - November 15, 2021
Background
In Indonesia, the artisanal and small-scale gold mining (ASGM) sector serves as a direct income source for over 300,000 people and indirectly supports approximately 1 million people. ASGM is a significant contributor to the country’s economy, producing approximately 50-100 tonnes of gold per year valued at $3-5 billion. However, the informal nature of the majority of ASGM operations poses significant challenges to the artisanal miners by limiting the price received for their gold and limiting access to cleaner and safer technologies and financing. Both of these challenges can be addressed through the sustainable development of the ASGM sector.
In 2015, the Artisanal Gold Council (AGC) launched “The Sustainable Development of Artisanal and Small-Scale Gold Mining in Indonesia (SD-ASGM)” project or “Program Emas Rakyat Sejahtera (PERS) / Prosperous People’s Gold Program” as it is called in Bahasa Indonesia, funded by Global Affairs Canada and implemented by the AGC in association with partner NGO Yayasan Emas Artisanal Indonesia (YEAI). The five-year project aims to improve incomes, health and environmental practices of the marginalized men and women who depend on the ASGM economy in three ASGM communities: Parenggean (Central Kalimantan), Tatelu (North Sulawesi), and Tobongon (North Sulawesi).
In accordance with the Feminist International Assistance Policy of the Government of Canada, gender mainstreaming is prioritized throughout the planning and implementation of the project. The project identified the roles of women and men involved in the sector, in order to understand the potential to reduce gender inequality by providing women with equal access to opportunities and information.
Understanding the needs of women in the project area communities
Gender mapping conducted in the Project Areas in 2018-2019 by the PERS team revealed that women are interested in contributing to the fluctuating and insufficient family income that men earned through ASGM. Women play a relatively minor role in physically engaging in artisanal mining and processing activities. However, women accounted for 20% of mine owners in Tobongon and 40% of mine owners in Tatelu. The majority of women have inherited the mines from their parents or husbands while a minority have purchased the mines themselves. A few well-connected women own ore processing centers as well. In Parenggean, women are also absent from hard rock mining but do collect alluvial ore from dredges and deliver it to ore processing facilities where mercury is used intensively. Mercury is a toxic heavy metal commonly used in ASGM which is banned in Indonesia since 2014.
A woman miner panning discarded tailings in Parenggean for fine gold.
Many women in the project areas engage in small businesses, such as selling food to miners and expressed difficulties in saving for the future, especially for their children’s education or for a family emergency. Gender mapping revealed that in the ASGM communities, women were perceived as more skilled at managing finances compared to men. In addition, men assume that investments and savings are the responsibilities of women. This emphasizes the importance of including women in access to finance initiatives in order to support the family income and stabilize their future. However, women revealed challenges in maximizing their potential to support the family income due to time spent managing household chores, thus making them financially dependent on men. Nearly all women carried the double burden of housekeeping and taking care of their families.
The idea to establish women’s savings and loan cooperatives within the PERS Project stemmed from the need to provide financial independence to local women for the sustainable development of the ASGM sector. As the first step, the PERS Project team conducted a series of training sessions to understand women’s perspectives on cooperatives. It was found that the community strongly supported empowering women through establishing women’s cooperatives to manage savings and loans. Following numerous capacity-building training courses with Matuari Mandiri Women’s Cooperative in Tatelu, Ms. Selvi, a training participant, identified the cooperatives as a way out from the financial issues faced by the women in the village. Another training participant Ms. Decy revealed that most people in the community traditionally borrow money from “loan sharks”, individuals who loaned money to villagers at high-interest rates.
Some women opposed the establishment of cooperatives because it would require them to save money – a challenging task for low-income households. They preferred that the cooperatives attempt to replace “loan sharks” and immediately provide them loans without requiring members to contribute to the capital. Savings and loan cooperatives require their members to contribute to the capital via principal savings which are paid by the members upon registering with the cooperative, and via mandatory savings which is a set amount agreed upon by the members, paid monthly to the cooperative by the registered members. However, the PERS project is exploring access to additional finance as one of its major pillars, through actions such as proposed restructuring in the downstream gold supply chain, access to a better gold price by linking the Cooperatives directly to the market, and the formal solicitation of social impact investors to the ore processing ventures.
Establishing and strengthening women’s cooperatives
The PERS Project established or strengthened women’s participation in cooperatives across its three project sites. From the capacitation of women’s cooperative Matuari Mandiri in Tatelu, North Sulawesi to the creation and formalization of women’s cooperative Bulawan Sejahtera in Tobongon, North Sulawesi and the inception and capacitation of an equitable number of women operating within the Pudu Jaya Lestari cooperative in Parenggean, Central Kalimantan.
The Bulawaan Sejahtera Cooperative was established in Tobongoan village on July 2, 2018, followed by the Matuari Mandiri Cooperative in Tatelu Village on July 16, 2018, with 20 and 25 members, respectively.
Upon establishment, the women’s cooperatives collected principal savings of IDR 100,000 (~7.05 USD) and mandatory savings of IDR 25,000 (~1.75 USD) from each member, prioritizing lending money to members who already had small businesses in operation. Obtaining legal status in 2019 allowed the women’s cooperatives to get donors to further support their capitalization.
More than a savings and loan cooperative
The project goal was that the cooperatives will act not only as a resource for savings and affordable loans for women, but also play a role in raising awareness on gender equality, women and children’s rights, and women in leadership. A training participant from the Tobongon village stated that training on such topics can change the mindset of the women in the village and encourage them to take action to improve their income and living standards.
In order to facilitate this additional participation of women in local ASGM activities, the project designed a space for women at project sites that are used for the women’s cooperative meetings, as a training area for women and as a childcare facility as needed.
The women’s cooperatives also play a leadership role in the community, supporting women and girls in protecting their human rights by raising awareness on available pre-existing government services and their rights to public services. Members of the women’s cooperative attended an activity assisted by the project in Tatelu in 2019 to secure family cards, identity cards, birth, marriage, and death certificates, which are documents that provide them with access to government services such as public health care and education.
Since its establishment, the project has been enhancing the capacity of the women’s cooperatives in management; their members participating in project management, organizing events, training, and assisting with mobilizing communities. This capacitation is paying off in women’s representation within decision-making among the beneficiaries of the PERS Project’s mercury-free processing facilities. In Tatelu, several members of the management team will be women within the Batu Emas Cooperative and the mercury-free processing facility will coordinate with Matuari Mandiri for various components of the supply chain including ore sourcing and repurposing. In Tobongon, Women’s Cooperative Bulawan Sejahtera is the recipient beneficiary of the mercury-free processing facility and will be jointly managing the ore processing business with the Tobongon village-owned enterprises (BUMDesa) Bulwan. In Parenggean, two out of three decision-makers within the beneficiary Pudu Jaya Mining Cooperative are women.
Moreover, the legal mechanism for the transfer of the project’s facilities contains obligations for gender-equitable hiring in relation to managing the ore processing business. Members of women’s cooperatives also played a significant role in organizing training events on mercury-free gold processing for miners and other cooperative members in North Sulawesi. During the COVID-19 pandemic, a strong volunteer network emerged from the women’s cooperative who carried out awareness-raising activities on safe mining practices and measures to prevent the spread of COVID-19 in the community.
Identity cards were released by the government for Parenggean miners. These ID cards connect citizens with government services such as health care, education for their children, and access to permit applications.
The progress of and challenges for women’s cooperatives
The Matuari Mandiri Cooperative in Tatelu has grown over time, from 25 members at the inception to 49 members today whereas the Bulawaan Sejahtera Cooperative has grown from 20 at the inception to 40 members today.
Currently, the Matuari Mandiri Cooperative offers loans to its members at a low-interest rate who can not access bank loans and would have otherwise had to borrow money from“loan sharks” at higher interest rates. Nineteen women have started businesses such as operating the cooperative canteen in the local market and vegetable and fish sales stalls using the loans. Moreover, the cooperative operations received considerable endorsement from several community groups such as Arisan groups which are a form of rotating savings and credit association, family welfare development groups, and groups of mothers who work in the market. The local government also supported the cooperatives and ensured that the members of the women’s cooperative made up 30% of the mercury-free gold processing facility management team.
In Tobongon Village, Bulawaan Sejahtera Cooperative has so far accumulated IDR 17 million (~ 1200 USD) through member deposits. Most cooperative members are women who belong to church societies and work as housewives who are frequently involved in community events. These women play a crucial role in the smooth operation of day-to-day life in the community by managing mining equipment rental shops and small stores offering daily essentials, snacks and apparel. Ms. Yerina, a cooperative member revealed that prior to the establishment of the cooperative, it was extremely difficult for them to establish a business due to lack of finance. She mentioned that since the establishment of the cooperative the members have received financing to establish and run smaller enterprises that empower women. Furthermore, Mrs. Merlin Simbar, another cooperative member, explained that they could not manage family finances well prior to the cooperative. The continuous training they receive on financial management through the cooperative allows them to set aside money as savings.
A business training session with the women’s cooperative and Beneficiary of the PERS facility in Tobongon, Bulawan Sejahtera.
The Pudu Jaya Lestari Cooperative in Parenggean currently consists of 336 members of which 30% are women. The project worked to ensure an equitable number of women operates within the Pudu Jaya Lestari Cooperative and they have formed a women’s unit within the cooperative. At the 2021 annual members meeting, Mrs. Nurhalimah was chosen as the new chairperson of the cooperative which is a major achievement on women empowerment.
The potential of the women’s cooperatives to sustain beyond the duration of the project was evident when Matuari Mandiri Cooperative in Tatelu Village received a micro-grant of $76,790 USD from the Global Environment Facility funded planetGOLD Indonesia (GOLD-ISMIA) project to enhance their capacity for management and business in 2020.
However, some challenges remain. Limited capital and scarcity of funding are still major challenges for women’s cooperatives. In order to address these challenges, cooperatives are approaching potential investors and plan to start a business focused on buying and selling gold and agricultural products as a sustainable income source. Also, during the COVID-19 pandemic, cooperative meetings, savings and loan activities were slowed down considering the financial challenges faced by the members affected by the pandemic.
Prospects beyond the PERS Project
Women’s cooperatives are aiming to achieve autonomy to sustain beyond the duration of the PERS project. However, the cooperatives also have prospects of receiving funding from international development organizations. An international development organization has formally expressed an interest to provide funding and human resources support to both women’s cooperatives in North Sulawesi. Matuari Mandiri Cooperative is the recipient of a grant from the Global Environment Facility funded planetGOLD ISMIA to build their own mercury-free ore processing facility; a testament to their capacitation by PERS. Formal statements of intended support for the Bulawan Sejahtera Cooperative have also been made, including potential grants and assistance with environment and mining permit management. Bulawan Sejahtera has received a formal letter of support from the Regent of East Bolamongondow, recommending they become the recipient to obtain funding from an international development agency.
The establishment of the women’s cooperatives by the PERS project provided women in ASGM communities a route for financial independence along with training to successfully operate small businesses linked to ASGM. Women’s participation within the decision-making among the Beneficiaries of the PERS project’s mercury-free processing facilities along with positive attention the cooperatives have gained from the international development organizations emphasizes that women are key change agents for the sustainable development of the ASGM sector.