An illegal artisanal miner inspects an excavated rock for traces of gold at the Prestea-Huni Valley Municipal District in the Western Region, Ghana, August 17, 2024. REUTERS/Francis Kokoroko
Ghana is losing billions of dollars annually to gold smuggling from its thriving artisanal mining sector, with a significant portion of the illicit trade linked to the United Arab Emirates (UAE), according to a report by Swiss nonprofit Swissaid.
The report revealed a staggering trade gap of 229 metric tons—worth approximately $11.4 billion—between Ghana’s reported gold exports and the imports recorded by trading partners over a five-year period. Most of the unaccounted gold is believed to have ended up in Dubai.
“This is just the tip of the iceberg,” said Ulf Laessing, head of the Sahel programme at Germany’s Konrad Adenauer Foundation, who monitors insurgencies and artisanal mining in the region. “Hand-carried gold does not have to be declared in Dubai… informal gold is mostly brought in on flights,” he added, highlighting the shadowy nature of African gold flows into the UAE.
According to the report, much of Ghana’s smuggled gold first passes through Togo before reaching Dubai. Other routes channel the gold through Burkina Faso into Mali, exploiting the region’s porous borders.
A senior official from Ghana’s Minerals Commission described the findings as “a notorious fact.” Ghana’s Ministry of Finance did not respond to requests for comment.
Swissaid traced part of the surge in smuggling to a 3% withholding tax introduced in 2019 on artisanal gold exports. Rather than increasing revenue, the policy caused a dramatic drop in formal declarations, pushing miners toward the informal market. The government later reduced the tax to 1.5% in 2022, which helped restore some formal exports.
In March this year, the Finance Minister scrapped the tax entirely and credited recent policy reforms for a sharp increase in declared artisanal exports.
Despite the efforts, an estimated 34 metric tons of gold went undeclared in 2023—equivalent to the entire recorded output from Ghana’s artisanal sector, according to the June 11 Swissaid report.
Slow Progress on Reforms
Ghana earned $11.6 billion from gold exports in 2023 and has undertaken several reforms to regulate and centralize the sector. However, the report notes that the country’s experience mirrors a broader continental trend in which African gold-producing nations report significantly lower export figures than those declared by importing countries, particularly the UAE.
Although Dubai has pledged to tighten oversight and curb gold smuggling, results remain limited.
Informal gold mining supports the livelihoods of over 10 million people in sub-Saharan Africa, according to a UN report released in May. However, it increasingly serves as a conduit for organized crime and armed conflict.
“While the new government has shown some willingness to address long-standing governance issues in the gold sector—issues largely ignored by the previous administration—its pace has been quite slow,” said Bright Simons, Vice President of Accra-based think tank Imani Center for Policy and Education.
Credit: Reuters
