Contraband Gold in the Great Lakes Region - In Region Cross Border Gold Flows Versus Out-Region Smuggling

The legal and illegal gold flows were examined in this study which takes place within the ICGLR Region and from the ICGLR Region to the United Arab Emirates, the principal import destination for ASM gold from the ICGLR Region. The study found that illegal ASM gold flows from the region dwarfed cross-border flows within the region: in the three years from 2009-2011, conservative estimates of illegal gold exports from the ICGLR region averaged some 17.5 tonnes per year. This represents a collective royalty loss to ICGLR governments of at least $15 million per year on average (and more than $20 million in 2011). By comparison, the largest of the cross border flows analyzed, from Tanzania to Kenya, amounted in 2010 to only some 1.3 tonnes per year, while smuggling from Tanzania to Dubai that year topped 13.5 tonnes. The purpose of this study was not so much to re-confirm the UAE’s role as the primary destination for illegally exported African ASM gold as it was to identify chokepoints in the UAE/Dubai gold chain where remedial action could be cost effectively targeted. Secondly, the study aimed to evaluate the extent which UAE/Dubai authorities might be open to implement such targeted interventions. Results of the study were mixed: on the positive side the study determined that there are indeed several chokepoints in the UAE/Dubai chain where targeted interventions could have a significant impact on smuggled gold coming in from the ICGLR region. On the down side, the author found Dubai authorities only marginally willing to discuss the issue of illegally imported ICGLR region gold.