In a big step to guard its huge mineral riches Ghana—the top gold maker in Africa—has started a tough fight against illegal gold smuggling that’s shaking up global trading networks.
Officials said yesterday that they’ll kick out three Indian citizens while three others will face charges after big raids found complex smuggling setups. This action puts Ghana’s new wide-ranging gold rules, which started last month, to the test for the first time.
“This is just the start of a harsh battle against those stealing our country’s wealth,” said Chief Superintendent Osman Alhassan, who leads investigations at Ghana’s National Security.
The crackdown is a result of the Ghana Gold Board Act that took effect on April 30th. This law has caused a revolution in the country’s gold trade. It stops foreigners from taking part in local markets and makes all deals go through one government regulator.
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Before the deadline, officials carried out their first operation. They took 4.36 kilograms of gold about $133,000 in cash, gold counting machines, and other gear from three Indian citizens. These people were working through what officials called a front company. Foreign interests controlled this company, but it was registered to a Ghanaian citizen.
A second raid following the new rules’ start caught three more foreign suspects with gold bars, money, and bullets. Unlike those arrested before the cutoff, these people now risk harsh punishments and maybe jail time.
“We’re making it clear—Ghana’s gold is for Ghanaians,” said Prince Minkah, who speaks for the Ghana Gold Board, the country’s strengthened watchdog.
This crackdown shows the tricky issues facing resource-rich African countries as they try to get more value from their natural riches. Even though Ghana leads Africa in gold production with exports worth over $11.6 billion last year, it’s had trouble with widespread smuggling that takes a lot of money away from the government.
Experts in the industry think that a big part of Ghana’s small-scale gold production—which makes up about a third of the country’s total—has often moved through unofficial channels ending up in places like India without proper taxes or monitoring.
The new rules show one of Africa’s boldest tries to bring precious metal trading under national control, a trend that investors and big mining companies around the world are keeping an eye on as similar moves to control resources gain ground across Africa.
For gold markets worldwide, this clampdown points to possible issues in the supply chain and stricter rules to follow for buyers sourcing from the largest producer of gold in Africa.
