Report reveals billions of dollars worth of gold smuggled to the UAE annually

Gold smuggling out of Africa to the United Arab Emirates has reached alarming levels, with hundreds of tonnes of gold worth billions of dollars being illegally exported every year, according to a recent report by Swissaid.

The report revealed that in 2022 alone, a staggering 435 tonnes of gold, primarily mined by small-scale miners, were smuggled out of Africa, amounting to over $30 billion in value. The UAE emerged as the top destination for Africa’s smuggled gold, receiving 405 tonnes in 2022 and over 2,500 tonnes over the past decade, with a total value exceeding $115 billion.

While the UAE official acknowledged the issue and mentioned steps taken to address concerns about gold smuggling, experts and governments have raised alarms about the implications of such large-scale smuggling. Apart from the loss in tax revenues, the illicit gold trade poses risks of money laundering, terrorist financing, and sanctions evasion.

Marc Ummel, the commodities lead at Swissaid, highlighted the role of the UAE in facilitating gold laundering, as large quantities of smuggled gold gain a legal status by passing through the country. The report also pointed out discrepancies in gold export and import data, particularly in African countries involved in smuggling, raising questions about the enforcement of regulations in the sector.

The surge in artisanal mining, driven by the doubling of gold prices since 2009, has led to a significant increase in gold production in African countries. Artisanal and small-scale mining in Africa produced between 443 and 596 tonnes of gold in 2022, with over 70% of it remaining undeclared. This contrasts with industrial mining, which produces around 500 tonnes of gold annually.

The report emphasized that a majority of African gold imported into the UAE originates from informal artisanal and small-scale mining, providing livelihoods to millions but often at the expense of local communities and the environment. The researchers noted a discrepancy in the sourcing practices of Swiss refineries, which import large quantities of gold from the UAE, the primary hub for African artisanal gold.

Despite the challenges, a UAE official highlighted the country’s recognition of the importance of artisanal and small-scale gold mining and its efforts to ensure that miners receive fair value for their extracted gold.

The findings of the Swissaid report shed light on the complex dynamics of the gold trade between Africa and the UAE, raising concerns about the need for stronger regulations, enforcement mechanisms, and international cooperation to combat illicit gold smuggling and its associated risks.