KAMPALA – Uganda’s gold exporters have expressed deep concern over the numerous obstacles that are impeding their business operations.
These concerns have arisen following the implementation of an order by the Uganda Revenue Authority (URA) to temporarily suspend gold exportation, which has resulted in widespread frustration among exporters and a detrimental effect on the local economy.
This recent directive, which follows a similar closure in 2020, has left Uganda’s gold refineries in a state of uncertainty, with a growing stockpile of gold awaiting refining and re-exportation.
For the past five days, the exporters said they have been unable to export gold, resulting in financial losses and logistical complications for the affected businesses.
Adding to the concerns, neighboring Rwanda has seized this opportunity to bolster its own gold industry.
The President of Guinea recently signed an agreement with the Rwandan government, directing all gold from Guinea to be refined in Kigali, Rwanda.
Kumran Singh, Chairperson of the Aurum Tradewinds Refineries Association, expressed concern over the diversion of potential clients who had planned to bring their gold to Uganda for refining.
This ,he said further exacerbates the challenges faced by Ugandan gold exporters.
The closure of gold exports and the diversion of clients to Rwanda have raised suspicions among stakeholders, who suspect a deliberate attempt to undermine Uganda’s gold refining business.
There are allegations that since 2017, neighboring countries and individuals with questionable motives have collaborated with opposition members of Parliament and elements within the Uganda Revenue Authority to undermine the industry.
One of the main issues highlighted is the introduction of an illegal export levy on transiting gold, which not only contradicts the principles of the East African Community Customs Union but also undermines Uganda’s vision of exporting minerals only after value has been added.
Singh claims that the URA has authorized a leading exporter of gold in Uganda to use a transshipment customs procedure, allowing them to export more than 30% of gold without undergoing the necessary processing.
The closure of gold exports and the challenges faced by Ugandan gold refineries raise concerns about the industry’s future and its potential impact on the country’s economy.
Stakeholders urgently call for dialogue and action to address the issues surrounding the closure and to protect and promote the local gold refining business.
As the situation unfolds, industry players and government officials are expected to engage in discussions to find a resolution and ensure the continued growth and stability of Uganda’s gold export industry.
In 2023, the Minister of Energy and Mineral Development brought the issue of the gold export levy to the attention of Parliament. The Attorney General advised the Minister to revoke the illegal Mining & Minerals (Export Levy on Refined Gold) Regulations, 2023, which introduced the illegal export levy.
Subsequently, the Minister of Energy and Mineral Development, Ruth Nankabirwa, advised the URA to halt the implementation of the regulations and cease the collection of the illegal export levy.
However, the authority has disregarded the government’s position and continues to demand the unlawful export levy from gold refineries.
This has resulted in the complete closure of the gold refining and export business, leading to substantial business losses and the diversion of gold refining and export activities from Uganda to Rwanda.
Abel Kagumire, the Commissioner of Customs at URA, stated in an interview that the situation at hand is quite complex. He openly acknowledged the complaints and assured that he would provide further details to address the issue.
