High-Risk Artisanal Mining’
In a country with one of the world’s highest poverty rates, the mining industry has been a key source of employment and income. But artisanal gold extraction has been linked to toxic environmental and health hazards, according to experts. Moreover, Sudan’s mining law is a weak tool to regulate the sector, despite an increasing demand for new laws by HSF and other local and international organisations.
Across the country, a vast number of small-scale artisanal gold mines have opened up in recent years. These mines employ more than two million people and are producing a majority of the country’s gold, according to experts. But they often leave behind piles of hazardous waste, posing serious threats to people’s health.
Most artisanal gold is then processed in a traditional process that uses mercury, a deadly poison that causes severe birth defects and other health problems. The practice is a main contributor to a chemical contamination problem in the region, which has prompted Sudan’s government to introduce a new regulation requiring all artisanal mines to use more modern methods.
The result: a major chunk of the nation’s gold production is being smuggled out, according to multiple insider sources. It’s estimated that between 70 and 90 percent of the country’s gold is illicitly sold or exported.
This is a serious problem because the Sudanese government is only collecting a fraction of its gold revenues, which are being diverted to foreign investors. The government’s mismanagement of the sector has triggered a crisis in the mining sector and a rise in illegal mining.
A ‘Gold Rush Driven by High-Risk Artisanal Mining’
In a bid to combat this, the government in 2021 launched an agency dedicated to managing the minerals sector. This agency is a semi-autonomous body with a clear mandate from the military leadership to impose policies that are favorable to foreign investors, according to interviews with a whistleblower within the agency and official documents reviewed by CNN.
Traders and NGOs alike have been voicing their concerns about the agency’s monopolistic approach to mining, and are calling on the government to remove it from power. The agency’s current management is dominated by senior officials who have backgrounds in the state oil and gas companies, a situation that has stifled competition.
Russia’s Growing Bond with Sudan’s Military Leaders: Creating a New Gold Smuggling Model
In the last year, as Russian President Vladimir Zheltov’s relationship with Khartoum has grew, the country’s military leadership has become increasingly reliant on Moscow. This has enabled Russian actors to evade state institutions and regulatory requirements – including regulations against foreign companies – in an effort to skirt a US embargo on gold sales.
A key turning point for Russia’s gold dealings in Sudan has come with the creation of al-Solag, a company owned by a US-sanctioned mining company based in Russia, which operates the Meroe Gold mine in South Sudan. The company has been a key player in Sudan’s gold smuggling network, according to five official Sudanese sources and company registration documents reviewed by CNN.
