Smuggled gold in Switzerland: issues, challenges, and consequences
Swissaid Report: Analysis of Gold Trade from Africa to Switzerland
According to a report by the NGO Swissaid, published in May 2024, between 321 and 374 tons of gold are unofficially imported from Africa each year. Titled "On the Trail of African Gold," this report highlights the dark side of this trade. Based in Bern and Lausanne, the organization denounces a practice that favors illegal gold importers while penalizing African countries. But what exactly is this network, and what solutions exist to prevent it?
Impact of Artisanal Mines on African States' Revenues
There are numerous artisanal mines on the African continent, which complicates the traceability of gold. These mines often operate outside the legal circuit, selling to intermediaries who bypass administrative steps related to export documents. The loss of revenue for African countries is enormous, as this precious metal does not follow official channels, preventing them from taxing it. Additionally, miners are not protected against these "on-the-fly" buyers who make huge profits by purchasing gold cheaply on-site.
The Long Journey of Gold
A large portion of this gold is transported to the United Arab Emirates, where it is later resold. This is where Switzerland comes into play: with its major refineries (four of the nine largest in the world), it is heavily involved in this illegal trade. Swiss legislation considers the last place of transformation as the origin of the precious metal. Thus, gold from Africa, passing through the UAE, is considered Emirati for Switzerland. The gap between clandestinely imported gold and subsequently exported gold from the UAE is significant, as justified by Swissaid’s report. This gold enters the legal circuit through the UAE and ends up on the international market with a regularized status. It is high time for Swiss legislation to change, allowing for greater transparency and traceability in this very opaque trade. By changing this legislation, Switzerland, being a significant player in the field, would have a beneficial impact on these exchanges, which more than doubled between 2012 and 2022.
Solutions to the Challenges Mentioned
There is, however, a solution to this problem: Fairtrade gold, which does not participate in this trade and contributes to fair remuneration for miners. Gold from this channel does not contaminate the environment and is considered responsible, both humanly and ecologically.
Moreover, this gold is not part of the clandestine trafficking that precarizes both states and miners. The numerous controls by the organization, which has no personal interests in gold, give these channels an additional advantage. This transparency throughout the supply chain and direct access to producers is a hallmark of this ecological and ethical industry.
It is therefore high time for changes both legally and at the customer level. Greater awareness of this market will allow informed customers to make ethical choices by only buying gold from legal channels. Governments, in turn, must change their procedures by tightening existing legislation, especially in Switzerland. As the second-largest gold importer in the world, the Swiss Confederation has personal interests in not tightening its legal code regarding this precious metal. Switzerland is well aware of the origins of the gold it buys but chooses to turn a blind eye because it needs it; it is heavily involved in this trade. The state must set an example and cannot allow this deplorable situation to continue. Switzerland has options to improve this, and it is time for a change!
At AGUAdeORO, we aim to bring people together around our values. We only buy gold from secure channels that fairly compensate miners and do not pollute the planet with chemicals, to create our jewelry.
Founded in 2009, AGUAdeORO is a jewelry store based in Geneva and Zurich, offering customers the opportunity to purchase ethical jewelry made in Switzerland. We are committed to offering jewelry that combines sustainable development and elegance.