Gold smuggling from Africa to UAE on the rise
According to a report published on Thursday by Swissaid, an organization focused on development aid and advocacy, gold smuggling out of Africa, primarily to the United Arab Emirates, has significantly increased over the past decade. The report revealed that approximately 435 tonnes of gold, valued at over $30 billion, were smuggled out of Africa in 2022 alone. The UAE was identified as the primary destination for Africa’s smuggled gold, receiving 405 tonnes in 2022 and over 2,500 tonnes worth more than $115 billion over the previous decade.
Insight: Impact on local economies and environment
The surge in gold smuggling highlights how artisanal mining, involving millions of people, has evolved into a significant industry within Africa. This not only has detrimental effects on tax revenues lost to smuggling but also raises concerns about an extensive underground economy susceptible to money laundering, terrorist financing, and evasion of sanctions. Additionally, the environmental and social costs of artisanal mining on local communities in Africa are substantial, underscoring the urgent need for regulation and responsible sourcing practices.
Efforts to curb smuggling and enforce regulations
In response to the findings, a UAE official emphasized that the country has taken steps to address concerns regarding gold smuggling by implementing new regulations on precious metals. However, the continuous influx of illegal gold into the UAE indicates loopholes in the current regulatory framework. Marc Ummel from Swissaid pointed out that the UAE’s role in enabling gold laundering stems from its leniency towards large quantities of smuggled gold passing through its borders, calling for stricter enforcement measures.
Insight: Artisanal mining’s contribution to the sector
With the price of gold doubling since 2009, the allure of artisanal mining has attracted a growing number of individuals in Africa. Swissaid estimates that artisanal and small-scale gold mining in African countries produced between 443 and 596 tonnes of gold in 2022, with a significant portion going undeclared. Despite the risks and challenges associated with informal mining practices, these methods sustain millions of livelihoods across the continent. It is crucial for the UAE and other importing nations to ensure that artisanal miners receive fair compensation for their labor while adhering to responsible sourcing practices.
Discrepancies in trade data and accountability
Swissaid’s analysis revealed discrepancies between official export data from African countries and import data from non-African nations, particularly regarding gold exports to the UAE. While some countries in Africa are involved in significant smuggling activities, the responsibility for enforcing regulations falls on both exporter and importer nations. The UAE Ministry of Economy’s assertion that it cannot be held responsible for inaccurate export records underscores the need for greater transparency and collaboration among all stakeholders involved in the gold trade.
In conclusion, the surge in gold smuggling from Africa to the UAE highlights the urgent need for enhanced regulation, enforcement, and responsible sourcing practices within the gold industry. Addressing the challenges posed by artisanal mining, smuggling, and environmental degradation requires a collective effort from governments, refineries, and international organizations to ensure transparency and sustainable development in the gold supply chain.
