Large portion of Nigeria’s gold is smuggled into UAE – Alake

The Minister of Solid Minerals Development, Dele Alake, has revealed that significant amounts of gold extracted in Nigeria are smuggled into the United Arab Emirate (UAE).

This results in the loss of badly needed revenue from taxes and royalties from unreported gold exports. According to a House of Representatives Committee on Solid Minerals, Nigeria loses $9 billion annually to illegal mining activities.

As a solution, the minister proposed a partnership between the UAE and Nigeria to establish regulatory frameworks that would curb illegal gold trade and strengthen economic profitability for both countries.

Speaking while receiving the UAE Ambassador to Nigeria, Salem Al Shamsi, in his office in Abuja on Tuesday, Mr Alake emphasised that a partnership between both countries would solidify the UAE’s position as a major hub for mineral trade.

In a statement by the Senior Special Assistant on Media to the Minister of Solid Minerals Development, Segun Tomori, on Tuesday in Abuja, Mr Alake also expressed interest in partnering with the UAE on technology transfer to advance Nigeria’s mining sector.

“In the mining sector, we see significant opportunities for collaboration. While there is considerable trade in gold, much of it remains illegal, with a large portion of Nigerian gold ending up in the UAE unlawfully.

“We propose working together to develop strategies to curb illegal gold trade and establish a regulatory framework that legitimises this trade, allowing both countries to maximise their benefits,” the minister stated.

Ambassador Al Shamsi speaks

On his part, Mr Al Shamsi reiterated the UAE’s dedication to strengthening its ties with Nigeria.

He mentioned the recent breakthrough in visa restrictions and a landmark Memorandum of Understanding (MOU) between UAE companies and Nigeria’s Solid Minerals Development Fund (SMDF).

“The lifting of visa application restrictions and the launch of a new visa application website demonstrate my country’s dedication to advancing bilateral relations,” Mr Al Shamsi stated.

Both countries agreed to establish a technical committee to explore collaboration strategies, to address illegal mineral trade and promote legitimate commerce.

Illegal Gold Exports in Nigeria, Africa

A report by SwissAid, a Swiss development organisation, indicates that the UAE remains a major destination for undeclared gold where it often gains legal status.

According to the report, around 66.5 per cent of the UAE’s gold imports from Africa in 2022 were sourced through smuggling. Also, 2,569 tonnes of African gold entered the UAE without being declared for export, representing a value of $115.3 billion between 2012 and 2022.

Sadly, a large chunk of Nigeria’s gold revenue from a vast reserve of 21.37 tonnes spread across Northern Nigeria and Osun State, remain unaccounted for.

Despite the robust potential of the sector, its contribution to national growth remains poor. According to the National Bureau of Statistics, the Mining & Quarrying sector contributed 7.86 per cent to the overall GDP in the first quarter of 2024.

According to Mr Alake, at the heart of Nigeria’s problem of illegal mining and export are foreign illegal miners who also sponsor banditry.