…Gold Smuggling Cartels Rob Nation Of $11.4 Billion Annually – Report Reveals Shocking Scale
Ghana, a titan in Africa’s gold production, is hemorrhaging a staggering $11.4 billion each year due to rampant gold smuggling, with a significant chunk of the illicit wealth ending up in the glittering vaults of the United Arab Emirates.
A bombshell report by Swissaid, a Swiss-based non-profit specializing in agroecology and gender equality, has ripped the lid off this multi-billion dollar illicit trade, exposing a gaping hole in Ghana’s national coffers.
The report, a damning indictment of the nation’s porous borders and regulatory loopholes, meticulously details a colossal trade gap of 229 metric tons between Ghana’s declared gold exports and imports over a five-year period.
The ultimate destination for most of this undeclared gold? Dubai, the bustling hub often cited as a haven for informal gold trade.
“This is just the beginning of the problem,” warned Ulf Laessing, who spearheads the Sahel program at Germany’s Konrad Adenauer Foundation, an institution dedicated to studying insurgency and artisanal mining in the region.
Speaking from Dakar, Senegal, Laessing highlighted the insidious methods employed, pointing out that “Gold carried by hand does not need to be declared in Dubai, informal gold is mainly transported on flights,” a stark revelation of the hidden pathways used to spirit Africa’s precious metal into the UAE.
Swissaid’s investigation further revealed a well-worn smuggling route: Ghanaian gold is often trafficked first to neighboring Togo, before embarking on its journey to Dubai. Other consignments, the report noted, exploit the weak borders, transiting through Burkina Faso into Mali.
Officials within Ghana’s Minerals Commission, speaking anonymously, conceded that Swissaid’s findings were merely “a well-known fact,” a chilling admission of the systemic nature of the problem.
Disturbingly, the nation’s finance ministry remained conspicuously silent when approached for comment, raising further questions about accountability.
The report also sheds light on the disastrous impact of Ghana’s own tax policies. A 3% withholding tax slapped on artisanal gold exports in 2019 backfired spectacularly, causing declared exports to plummet as smugglers capitalized on the higher incentive for illicit trade.
While a subsequent reduction of the tax to 1.5% in 2022 offered a partial reprieve, leading to a recovery in formal exports, the damage had already been done.
Ghana’s finance minister, in a move widely lauded this March, finally scrapped the tax entirely, attributing recent surges in artisanal exports to these policy changes.
Despite these recent adjustments, the scale of the undeclared gold remains staggering.
An estimated 34 tons of gold produced in Ghana in 2023 were never formally declared – a figure roughly equivalent to the country’s entire artisanal gold production for that year, according to the Swissaid report published on June 11.
Ghana raked in a respectable $11.6 billion from gold exports last year and has, in fits and starts, initiated reforms aimed at centralizing and cleaning up the trade.
However, Ghana’s predicament is a microcosm of a broader continental crisis. Gold-producing nations across Africa consistently report lower exports than what their importing counterparts, particularly the UAE, declare as receipts.
Despite Dubai’s much-touted reforms to rein in gold smuggling, the results have been, at best, limited.
While artisanal mining provides a lifeline for over 10 million people in sub-Saharan Africa, according to a May UN report, it has increasingly become a critical funding stream for organized crime and armed conflict, fueling instability across the region.
“While the new government has shown some willingness to fix some governance issues that have bedeviled the gold sector for years, and which were largely ignored by the previous administration, its pace has been quite slow,” lamented Bright Simons of the Accra-based think tank Imani Center for Policy and Education.
His words serve as a stark reminder that while Ghana grapples with its gold hemorrhage, the wheels of reform grind agonizingly slow, leaving the nation vulnerable to continued exploitation.
