A recent report by nonprofit Swissaid has revealed that Ghana has lost a staggering $11.4 billion to gold smuggling over the past five years, with the majority of the smuggled gold ending up in the United Arab Emirates (UAE). The report highlights a significant trade gap of 229 metric tons between Ghana’s gold exports and corresponding imports, raising concerns about the country’s revenue losses.
According to the report, the smuggling surge was partly triggered by a 3% withholding tax on artisanal gold exports imposed in 2019, which led to a dramatic collapse in declared exports. The tax was later scrapped in March this year, with the government praising policy reforms for a surge in artisanal exports.
Key Findings:
– Trade Gap: 229 metric tons of gold worth $11.4 billion smuggled out of Ghana over five years
– Destination: Majority of smuggled gold ends up in Dubai, UAE
– Smuggling Routes: Gold is smuggled to Togo before ending up in Dubai, while some bullion passes through Burkina Faso into Mali using porous borders
– Impact: Significant revenue losses for Ghana, undermining democracy and facilitating money laundering.
The report’s findings have been described as “a notorious fact” by a senior official at Ghana’s regulatory Minerals Commission. The government has stepped up reforms to centralize and clean up the gold trade, but the pace of these reforms has been criticized as slow.
The issue of gold smuggling is not unique to Ghana, with reports suggesting that billions of dollars’ worth of gold are smuggled out of Africa each year, often ending up in the UAE. The UAE has been accused of having poor regulations when it comes to discerning the actual origins of the metal.