Gold Production in Sudan
Gold production in Sudan has increased significantly in recent years. A report issued by the Ministry of Minerals showed a growth of gold production in the country in 2016, as well as a rise in the quantity of gold produced. In the last few years, gold mining has become the main export commodity of the country, generating revenues of more than $1 billion. However, the government faces a major challenge of smuggling gold out of the country.
The majority of the smuggled gold is transported through the United Arab Emirates. Some Russian cargo flights have also been tracked by the Sudanese government. These flights were operated by the 223d Flight Unit of the Russian military.
The Federal Government has been involved in controlling the gold mining sector. It has signed contracts with gold mining companies in the region, but has refused to disclose details of these contracts to the press. Moreover, it is evident that the authorities are more interested in protecting concession companies than traditional miners.
Gold Production in Sudan and Smuggling of Gold Out of the Country
Many of the mining companies are owned by security firms. Moreover, many of these companies use military vehicles for mining operations. They do not have a high operating capital to operate. Consequently, they prefer to sell their output outside the official channels. This makes them vulnerable to being left behind by the national companies.
Corruption is an important problem in the gold mining sector. In particular, it is rooted in centralized control, bribery, and political bribes. The Federal Government is also biased towards concession companies. That is, it tries to prevent the local companies from catching up to foreign companies. For example, it is trying to push the traditional miners out of the country for the purpose of creating a company-dominated environment.
Russia has stepped up its presence in the gold sector of Sudan to gain access to the precious metal. Yevgeny Prigozhin, an oligarch who is an ally of President Vladimir Putin, is the leading figure in this process. He provides training and weapons to the Sudanese army, while his US-sanctioned Meroe Gold extracts the precious metal and imports amphibious vehicles and construction equipment.
There is also a strong presence of Russian disinformation campaigns. Fake social media accounts have been set up to exacerbate political divisions in the country. Western officials have warned that the Russian-produced gold may have been smuggled out of Sudan.
Smuggling is a major challenge in the gold industry of Sudan. About 70% of the gold produced in the country is smuggled out. Smuggling also allows producers to avoid paying taxes. Nevertheless, the government should take steps to combat this issue. Similarly, it should provide equipment to secure its mining sites and control the activities of the Civil Defense Police and the Minerals Police.
There are a number of companies involved in the gold mining sector of Sudan. Some of them are government-owned, while others are dominated by security firms. Other companies are involved in reprocessing of tailings from the traditional mining process.