Uganda’s gold export earnings fell 80% year-on-year in 2022, central bank data showed on Friday, a drop an analyst said was due to effects of US sanctions against one of the East African country’s largest exporters of the precious metal.
Uganda shipped gold worth $201 million over the 12 months of 2022, down from $1 billion shipped during the same period in 2021, according to the central Bank of Uganda.
The country’s gold export earnings have surged since 2015 due to rising shipments from the African Gold Refinery (AGR), a gold processor set up by Belgian businessman Alain Goetz in Entebbe, about 45 km (28 miles) south of the capital Kampala.
The United States imposed sanctions on Goetz and a network of companies connected to him, including AGR, in March last year. At the time, Goetz said his inclusion on the US sanctions list was based on misinformation.
“The sanctioning of AGR, it definitely affected the sector … doing business internationally for them is now challenging after the sanctions,” Stephen Turyahikayo, a mining analyst who has done research on gold trade in the Great Lakes region, told Reuters.
Turyahikayo said the shipments likely also plummeted because the ministry of energy and mineral development had suspended the issuance of new export licenses pending implementation of a new mining law enacted last year.
Uganda is trying to position itself as a major gold processing and trading hub in the region and has been wooing investments in the sector.
Wagagai Mining Ltd, a Chinese firm, is establishing a large-scale gold project in eastern Uganda that is due for commissioning by the end of this year, according to the ministry.
(By Elias Biryabarema; Editing by George Obulutsa, Sofia Christensen and Shounak Dasgupta)