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South Africa has now been stamped as a major transit hub for the gold produced and smuggled from other African countries such as Zimbabwe. Smuggled gold from neighbouring countries for example Zimbabwe passes through South Africa, the report said.
Swissaid, a think tank focused on global development and conduct of orderly global trade said that South Africa has become a major transit hub for illegal bullion exports from the region with over US
In a report entitled “On the Trail of African Gold” released recently, the Bern-based non-governmental organization said that between 321 and 475 tons of gold from the informal sector was smuggled out of Africa each year. This translates to a value of between US$24bn (R451bn) and US$35bn (R658bn). The report also flagged that gold smuggling from Africa to countries such as the United Arab Emirates (UAE) is rising.
In 2023, SA produced 110 tons of gold while neighboring Zimbabwe produced 37 tons, although most of it was informal and was smuggled out. South Africa has now been stamped as a major transit hub for the gold produced and smuggled from other African countries such as Zimbabwe. Smuggled gold from neighbouring countries for example Zimbabwe passes through South Africa, the report said.
Swiss aid said that for almost every year between 2014 and 2022, exports of gold from South Africa into non-African countries were higher than the aggregate of total declared gold production in South Africa. Exports of gold from the country into non-African countries such as UAE were also higher than imports of gold into SA and undeclared informal gold production in SA, the report stressed.
The vast majority of gold exports from African countries to South Africa consist of industrial gold sent to Rand Refinery, a refinery based near Johannesburg that is the only one in Africa to be certified by the London Bullion Marketers Association (LBMA).
Rand Refinery, one of the largest single-site precious metals refining and smelting complexes in the world, had responded to Swissaid during the compilation of the report, detailing the quantities of gold it has refined in recent years. It said it refined 302 tons at an average purity of 82% in the fiscal year September to August 2017/2018, and 298 tons for the 2018/2019 year. For the year 2019/2020 it said it refined 272 tons of gold, and 296 tons at 75% purity for the 2020/2021 year. The refinery explained that half of the gold it processes generally comes from South Africa and the other half from other countries, the vast majority of which are African.
Swissaid concluded that the 133 to 149 tons of gold exported annually from African countries to South Africa between 2017 and 2021 corresponded to around half of the gold processed by Rand Refinery.
South Africa is among the top gold producers on the continent, while the JSE hosts the biggest bullion stocks. However, of late, companies have been migrating corporate offices and listings from the JSE, with AngloGold Ashanti moving its primary listing to New York last year.
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The South African gold mining industry is clearly in peril, as it has suffered the worst consequences of load shedding, meaning that South Africa could only account for 4% of global bullion output at 110 tons in 2022, down from 132 tons in 2018.
