Nigeria’s Illegal Gold Exports to UAE and Proposed Collaborative Solutions

The Nigerian Minister of Solid Minerals Development, Dele Alake, revealed that substantial quantities of gold mined in Nigeria are smuggled into the UAE, resulting in annual losses of $9 billion. To address this, a partnership with the UAE is proposed to establish regulatory frameworks and promote technological collaboration in the mining sector.

The Nigerian Minister of Solid Minerals Development, Dele Alake, has disclosed that a significant portion of gold mined in Nigeria is illicitly exported to the United Arab Emirates (UAE), leading to a substantial loss of revenue from taxes and royalties that would otherwise benefit the nation. Reports from the House of Representatives Committee on Solid Minerals estimate that illegal mining activities cost Nigeria approximately $9 billion annually. To combat this issue, Minister Alake has proposed a partnership with the UAE to create regulatory measures aimed at curbing illegal gold trafficking, thus enhancing economic advantages for both nations. During a meeting with UAE Ambassador to Nigeria, Salem Al Shamsi, in Abuja, Mr. Alake highlighted that such collaboration would reaffirm the UAE’s role as a crucial center for mineral trade. Additionally, Mr. Alake expressed an interest in technological collaboration with UAE partners to improve Nigeria’s mining sector. He remarked, “In the mining sector, we see significant opportunities for collaboration… Much of it remains illegal, with a large portion of Nigerian gold ending up in the UAE unlawfully.” Ambassador Al Shamsi emphasized the UAE’s commitment to bolstering relations with Nigeria, outlining recent advances such as the easing of visa restrictions and the establishment of a Memorandum of Understanding with Nigeria’s Solid Minerals Development Fund. He stated, “The lifting of visa application restrictions… demonstrate my country’s dedication to advancing bilateral relations.” Both officials agreed to form a technical committee focused on addressing illegal mineral trade while promoting legitimate commerce. A recent report by SwissAid indicates that the UAE is a primary hub for undeclared gold from Africa, with 66.5 percent of its gold imports from the continent in 2022 being attributed to smuggling. Between 2012 and 2022, smuggled gold worth approximately $115.3 billion entered the UAE without being declared. Alarmingly, Nigeria’s gold resources, estimated at 21.37 tonnes, remain largely unaccounted for, leading to underwhelming contributions to the nation’s GDP, which stood at just 7.86 percent in the first quarter of 2024.

Nigeria possesses significant gold deposits, particularly concentrated in regions such as Northern Nigeria and Osun State. However, the illegal mining and exportation of gold have hindered the country from capitalizing on these natural resources. Given the emerging trend of illicit gold transportation to the UAE, regulatory frameworks are needed to facilitate legitimate trade while enhancing national revenue through taxes and royalties. The partnership proposed by Minister Alake seeks not only to provide a solution to the illegal gold trade but also to improve the mining sector’s technological capabilities through collaboration with the UAE.

In summary, significant amounts of gold extracted from Nigeria are being clandestinely smuggled into the UAE, resulting in considerable revenue losses for Nigeria. The proposed partnership between Nigeria and the UAE aims to tackle illegal gold trading while enhancing the economic prospects of both nations through regulatory frameworks and technological collaboration. This proactive approach could transform Nigeria’s mining sector, contributing positively to its economy.

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