Investigation reveals UAE as top destination for Africa’s smuggled gold

The United Arab Emirates (UAE) has been identified as the top destination for illicit gold smuggled out of the African continent, according to a recent Swiss report. The report, published on Thursday by Swissaid, revealed that between 2012 and 2022, the UAE received over 2,500 tonnes of smuggled gold from Africa, with an estimated value of $115 billion.

The UAE, along with Switzerland and India, has been accused of exploiting the nearly 80 percent of annual African artisanal gold production that goes undeclared. The NGO’s report highlighted that gold smuggled from Africa typically ends up in the UAE, which accounted for 47 percent of total gold imported from Africa to non-African countries in 2022. In that year alone, around $31 billion worth of gold was smuggled out of Africa.

For years, the UAE has positioned itself as a major player in the global gold market while taking advantage of illegal channels. In 2022, gold imports to the UAE reached approximately $15 billion, marking a 50 percent increase in just one year. The ease of illegal gold transfers in the UAE is facilitated by a lenient global system that tracks the origin of gold to the country where it enters the international market, rather than its actual source.

A recent report by the UK Home Office identified the UAE as a country with “deficiencies” that make it susceptible to money-laundering networks exploiting international legal loopholes. Dubai, known as the City of Gold, serves as a central hub for the UAE’s thriving gold import and export markets. Over the past decade, gold exports to the UAE from Africa have surged from 86.3 tonnes to around 204 tonnes.

The report also highlighted Sudan, Mali, and Zimbabwe as leading African countries from which non-declared gold is smuggled. A 2021 US State Department report on Zimbabwe estimated that the country could be losing up to $100 million monthly to smuggling networks. In Sudan, UAE-backed militia leader Mohamed Hamdan Dagalo, also known as Hemeti, has been identified as a key beneficiary of the gold smuggling trade, with reported connections to Abu Dhabi and the Wagner Group.

The illicit trade and smuggling activities in Sudan have been exacerbated by ongoing civil unrest, with rival armed factions engaging in the smuggling of various goods, including gold, medicine, and fuel. As the price of gold continues to soar in 2024, the significance and value of gold-smuggling networks are expected to escalate conflicts in countries like Sudan and the Congo, according to Swissaid.

Despite changes in official legislation in 2018 and 2022 aimed at cracking down on money laundering and illegal trade, the UAE’s involvement in the illicit gold trade from Africa persists. The report emphasized that the UAE receives 93 percent of undeclared African exports, underscoring the country’s central role in the illicit gold trade network.