Ugandan top military officers have been linked to dirty gold deals currently ensuing in the neighbouring Congo.
Enough Project, a Washington-based nongovernmental organisation, in its reported titled: “Congo’s Conflict Gold Rush: Bringing gold into the legal trade in the Democratic Republic of Congo,” says gold is transited through Uganda and Burundi and sold in Dubai.
The report said the trade in illegally mined and smuggled “conflict gold” is fuelling both high-level military corruption and violent rebel groups in eastern Democratic Republic of the Congo (DRC).
Compiled by Fidel Bafilemba and Sasha Lezhnev, the report offers an in-depth portrait of the conflict gold supply chain, from muddy artisanal mines where gold is dug out with shovels and pick-axes, through illicit transport routes in Uganda, Burundi, and Dubai.
The U.S. government, European Union, jewellers, socially responsible investors, the World Bank, and activists all have important roles to play.
Congo’s mineral wealth has long been abused by armed actors, from Rwandan-backed armed groups such as the M23 to the Democratic Forces for the Liberation of Rwanda (FDLR) rebel group and Mai Mai Sheka factions to Congolese army commanders, whose troops have killed, pillaged, and sexually abused civilians.
While significant progress has been made in reducing armed groups’ profits from the 3T (tin, tungsten, and tantalum) mineral trade, the conflict gold trade continues to facilitate the criminal activities carried out by these groups.
According to the International Peace Information Service (IPIS), 70 percent of 3T mines in eastern Congo are conflict-free, while only 35 percent of gold mines are conflict-free.
According to U.N. experts, an estimated 98 percent of gold produced by artisanal miners in Congo—8 to 12 tons worth roughly $400 million—is smuggled out of the country annually.
Uganda is a transit route
The illicit conflict gold supply chain moves mainly through Uganda and Burundi, where military officers allegedly also profit, and then much of the gold arrives in Dubai, a major global gold trading and refining hub that has its own smuggling loopholes.
Artisanal mining in Congo is sadly forced underground by government officials and army commanders who benefit from the illegal nature of these activities.
The report does not name UPDF officers who are engaged in the smuggling.
Bukenya Matovu, spokesman for Uganda’s energy ministry, dismissed the report’s allegation that the supply chain along which Congolese gold reaches the international market includes links in Uganda.
“As a government, we are bound by international agreements and cannot condone illicit practices” Matovu told foreign media.
$400m gold smuggled to Uganda
Gold worth at least $400m was smuggled out of the Democratic Republic of Congo to Uganda and other East African countries in 2013.
United Nations report assessing the gold smuggling racket said the money was used to finance wars raging in the eastern DR Congo.
The report named three Uganda-based families as “major illegal gold exporters in 2013”, according to The East African.
In total, the five deals cost the DR Congo $1.36 billion, about twice the country’s combined annual budget for health and education in 2012.
The UN estimated that about $271 million’s worth of gold — two-thirds of the total value of smuggled DR Congo-extracted gold — passed through Uganda last year costing the Ugandan government $2.7 million in tax revenues.
In 2014 report, United Nations named four Ugandan companies involved in smuggling gold from eastern Democratic Republic of Congo.
The companies included; Uganda Commercial Impex (UCI) and Machanga Limited which are already under UN sanctions.
According to Daily Monitor, in Uganda, the illegal gold is sold in anonymous offices in upscale areas like Kololo, Kanjokya, Kamwokya and Muyenga.
Report recommends sanctions on Ugandan smugglers
The Enough Project 2015 report recommends sanctions and prosecution for gold smuggling and other criminal activities.
“U.S. Ambassador to the United Nations Samantha Power should work with the U.N. Security Council to designate well-documented conflict gold smugglers in Congo, Uganda, and Burundi for targeted sanctions, as well as urging the International Criminal Court to prosecute illegal gold smugglers.”
“Additionally, the U.S. State Department and U.N. Special Envoy Said Djinnit should pressure Uganda to cut its links to the gold smugglers and tighten airport checks on gold smuggling.”