Editor’s Note
This article examines the stark paradox of Africa’s gold sector—a vast natural resource fueling a multi-billion dollar shadow economy. As international bodies and market hubs increase scrutiny, the challenge of transforming this wealth into equitable development remains urgent.
Africa, rich with one-third of the world’s gold production, could transform this bounty into a powerful lever for development. Yet, each year, between 321 and 474 tonnes slip past official radars, feeding a grey economy estimated at between 24 and 35 billion USD.
In December 2024, the World Gold Council published an alarming report on clandestine flows of African gold, while the United Arab Emirates, a hub of the gold market, intensified its efforts to clean up the supply chain.
Behind these initiatives lies a major challenge: to reposition gold at the heart of responsible trade, without hindering the economic dynamics of the African continent, which is rich in one-third of global production. The majority of this gold comes from artisanal and small-scale gold mining (ASGM), an activity that mobilizes more than 10 million people across the continent.
However, the absence of suitable regulatory frameworks gives free rein to intermediaries and smuggling networks. In tense regions, such as the Sahel and the eastern Democratic Republic of Congo (DRC), gold fuels armed groups and criminal circuits, making traceability as complex as it is crucial.
In Africa, gold mining is not limited to an economic activity: it shapes conflicts and finances actors of instability. In the Central African Republic and Sudan, the Wagner group directly controls mines or imposes taxes on local operators.
Since 2022, these operations are estimated to have generated nearly 2.5 billion USD according to the World Gold Council. In eastern DRC, the stakes are equally strategic. Armed militias regulate access to mines and sell gold on international markets via opaque networks.
Faced with these excesses, the nerve centers of the gold trade are taking measures. The United Arab Emirates, with annual trade volumes exceeding 75 billion dollars, are on the front line.
Starting in 2023, Dubai applied the “UAE Good Delivery Standards,” imposing independent audits and strict control of supply chains. These measures, aligned with OECD recommendations, aim to ensure that imported gold does not come from conflict zones or criminal networks.
Furthermore, the UAE has strengthened its legislative arsenal by integrating responsible sourcing criteria into its anti-money laundering and counter-terrorist financing (AML/CFT) laws. Refineries that do not comply with these standards are excluded from commercial circuits.
The major innovation lies in the integration of blockchain to ensure unfalsifiable traceability of the precious metal. This technology allows tracking each ingot from its extraction to the market, thereby guaranteeing authenticity and reducing risks of fraud and money laundering.
Unlike traditional traceability systems, which rely on certifications sometimes subject to falsification, blockchain ensures instant and irrevocable verification of gold movements.
The UAE is not content with internal reforms. Aware of the transnational nature of gold trafficking, they have intensified their international cooperation. In February 2024, an agreement was signed with Tracfin, the French financial intelligence service, to exchange information on suspicious flows and closely monitor transactions related to gold trafficking.
In a Sahelian context where the gold trade is often associated with the rise of insecurity and organized crime, Mauritania stands as an exception. Unlike its neighbors where artisanal gold panning develops outside the legal framework, Nouakchott has established a formalization framework that allows for better regulation of mining.
This regulation has helped contain part of the trafficking, thus limiting the grip of armed groups on the gold sector. Mauritania has also strengthened its economic ties with the United Arab Emirates, making its gold a key element in its bilateral relationship with Dubai.
Agreements have been signed to improve marketing circuits and guarantee a more transparent supply. This partnership aims to combine economic attractiveness with the fight against smuggling.
While these efforts demonstrate a growing awareness, many challenges persist. The establishment of a global traceability system depends not only on trading hubs but also on producing countries, whose regulatory frameworks remain insufficient.
The persistence of armed groups in certain gold-producing areas further complicates the fight against trafficking. At the same time, demand for ethical gold is increasing, and consumers play a key role in the transition towards a more responsible market.
Supporting certified initiatives and encouraging transparent practices in the gold supply chain are levers to activate to reduce the grip of the informal economy.
The challenge is twofold: to preserve the economic potential of African gold while eradicating the illicit practices that hinder its benefits. The future of the sector will depend on the ability of states to structure their markets while relying on new technologies to guarantee sustainable transparency.