Dele Alake, the Minister of Solid Minerals Development in Nigeria, highlighted that a substantial quantity of gold mined in Nigeria is smuggled into the UAE, causing Nigeria to lose about $9 billion in annual revenue from illegal mining. He proposed a partnership with the UAE aimed at creating regulatory frameworks to counter illegal gold trade and enhance economic benefits for both nations. Ambassador Salem Al Shamsi confirmed the UAE’s commitment to strengthening ties with Nigeria through initiatives like the elimination of visa restrictions and establishing a technical committee to coordinate these efforts.
The Minister of Solid Minerals Development, Dele Alake, disclosed that a substantial volume of gold mined in Nigeria is illicitly transported to the United Arab Emirates (UAE). This illicit trade results in a significant loss of tax and royalty revenues from unreported gold exports, with the House of Representatives Committee on Solid Minerals estimating that Nigeria forfeits approximately $9 billion annually due to illegal mining practices. To address this issue, Minister Alake proposed a collaborative initiative between Nigeria and the UAE aimed at establishing regulatory frameworks to counter illegal gold trading and enhance economic benefits for both nations. During a meeting in Abuja with the UAE Ambassador to Nigeria, Salem Al Shamsi, Mr. Alake emphasized that such cooperation would reinforce the UAE’s role as a central hub for mineral commerce. According to a statement from the Senior Special Assistant on Media to the Minister, Segun Tomori, Minister Alake also expressed keen interest in engaging with the UAE on technology transfer to bolster 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,” he stated, proposing the need for strategies that validate this trade to maximize benefits for both countries. Ambassador Al Shamsi acknowledged the UAE’s commitment to enhancing relations with Nigeria, referencing recent advancements such as the alleviation of visa restrictions and a pivotal Memorandum of Understanding (MoU) between UAE firms and Nigeria’s Solid Minerals Development Fund. “The lifting of visa application restrictions and the launch of a new visa application website demonstrate my country’s dedication to advancing bilateral relations,” he affirmed. The two nations agreed to form a technical committee designed to explore strategies for collaboration, aiming to tackle illegal mineral trade while promoting legitimate economic activities. Reports from SwissAid indicate that the UAE is a significant destination for undeclared African gold, often gaining legal entry once there; around 66.5 percent of the UAE’s gold imports from Africa in 2022 were obtained through smuggling. Notably, between 2012 and 2022, an astonishing 2,569 tonnes of African gold, valued at over $115 billion, entered the UAE undeclared. Despite Nigeria’s vast gold reserves of approximately 21.37 tonnes located across Northern Nigeria and Osun State, a considerable portion of potential revenue remains unaccounted for, contributing minimally to national growth. Statistics from the National Bureau of Statistics indicate that the Mining and Quarrying sector accounted for only 7.86 percent of Nigeria’s GDP in the first quarter of 2024. Mr. Alake emphasized that foreign illegal miners exacerbating the illegal trade issue also fund banditry within the country.
The illegal mining of gold in Nigeria is a significant concern due to its detrimental impact on the economy. With substantial amounts of gold being smuggled to the UAE, Nigeria fails to collect essential tax revenues and royalties. The complications surrounding illegal mining not only include financial losses but also link to broader issues of security in Nigeria, as tapers of this illegal sector reportedly fund banditry. Regulatory frameworks and international partnerships are viewed as potential solutions to mitigate these challenges and bolster legitimate mining practices that can support national growth.
In conclusion, the illicit gold trade from Nigeria to the UAE represents a severe economic challenge, contributing to significant annual revenue losses while also intertwining with security issues within the country. Minister Dele Alake’s call for a partnership with the UAE shows promise in establishing regulatory measures that could transform the mining sector. Strengthening bilateral relations and collaboration in technological advancements is essential for both nations to capitalize on legitimate mining opportunities and address the complexities of illegal gold exports.
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