A significant portion of Africa’s gold, valued in the billions, is illegally smuggled out each year, predominantly finding its way to the United Arab Emirates (UAE), where it is refined and sold globally, according to a Swissaid report released on May 30.
In 2022 alone, over 435 metric tons of gold, worth more than $30 billion, were smuggled out of Africa, with the UAE, Turkey, and Switzerland being the primary destinations, the report revealed.
Swissaid, a Swiss aid and development organization, aims to increase transparency in the African gold trade and pressure industry stakeholders to enhance traceability and responsibility within gold supply chains. “We hope this will improve living conditions for local populations and working conditions for artisanal miners across Africa,” said Yvan Schulz, one of the report’s authors, to The Associated Press.
The report disclosed that 32% to 41% of African gold production was undeclared in 2022. Ghana led Africa’s gold production, followed by Mali and South Africa.
UAE’s Role in Gold Smuggling
Between 2012 and 2022, approximately 2,569 metric tons of gold, worth around $115 billion, were smuggled to the UAE. The discrepancy between UAE imports and African exports has grown, indicating an increase in gold smuggling over the past decade, from 234 metric tons in 2020 to 405 in 2022.
Switzerland’s Involvement
Switzerland, another significant purchaser of African gold, imported around 21 metric tons of undeclared gold from Africa in 2022. The actual figure may be higher when considering African gold imported through third countries. Once refined, tracing the gold to its final destination becomes virtually impossible.
Statistical Insights
Data from the United Nations Commodity Trade Statistics Database indicates that Switzerland is the primary buyer of gold from the UAE. The report highlighted the difficulty of determining the origins of refined gold, describing sourcing gold from the UAE as “notoriously risky.”
Official Responses
An official from the UAE’s media office stated that the country has implemented significant measures to address gold smuggling concerns and risks. The growing confidence of the international community in the UAE’s gold market reflects these efforts, the official noted.
“The UAE remains committed to combating gold smuggling and ensuring transparency and accountability within the gold and precious metals sector,” the official said.
Switzerland also acknowledged the challenges in tracing gold origins and has introduced measures to curb illegal flows. “Switzerland is committed to improving the traceability of commodity flows, transparency of statistics, and quality of controls,” said Fabian Maienfisch, spokesperson for Switzerland’s State Secretariat for Economic Affairs.
Recommendations
The report recommended that African states formalize artisanal and small-scale mining and strengthen border controls. It also urged non-African states to publish the origin and dispatch countries of imported gold and collaborate with authorities to identify illicit gold flows.
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