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Uganda losing millions in illegal gold mining

By Vision Reporter

Added 30th May 2013 01:56 AM

Uganda is losing millions of shillings due to illegal gold mining trade mushrooming across the country, New Vision has established. The reports come at a time when gold exports are dwindling leading to hefty revenue losses to the country.Uganda’s gold industry has seen a radical increase in gold pr

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Uganda is losing millions of shillings due to illegal gold mining trade mushrooming across the country, New Vision has established. The reports come at a time when gold exports are dwindling leading to hefty revenue losses to the country.Uganda’s gold industry has seen a radical increase in gold pr

By Patrick Jaramogi

Uganda is losing millions of shillings due to illegal gold mining trade mushrooming across the country, New Vision has established. The reports come at a time when gold exports are dwindling leading to hefty revenue losses to the country.

Uganda’s gold industry has seen a radical increase in gold production. The country produced 7tons of gold in 2000, up from 225kg produced in 1994. Gold appears to be widely distributed throughout Uganda, but has only been exploited by artisinal miners in a few areas near Busia, Buhweju and Kigezi Mubende and more recently, Karamoja in the northeast.

Most of the gold mined is located in small, high grade alluvial deposits located around the Proterozoic Buhweju basin. The Busia goldfield is considered an extension of the Lake Victoria Goldfields located in Tanzania.

Uganda's gold production has increased largely due to deregulation of gold sales by the Central Bank as well as gold from neighbouring DRC being sold in Uganda. Gold contributes up to 30% of export revenues from Uganda. Last year Uganda earned over $200m in gold exports alone, but experts have observed that this year won’t be the same due to illegal gold mining.

At a recent Uganda Revenue Authority mining sector stakeholder’s engagement held at the Silver Springs Hotel, experts noted that unless the illegal mining is stopped, the country was set to continue losing in cashing in on revenue collection.

“The issue of illegal mining of gold in Uganda is so alarming that last month Uganda didn’t export yet Kenya that is known not to have gold managed to export 40kg of gold smuggled from Uganda,” said Jackson Mayanja a geological survey inspector in charge of exports and imports.

New Vision has established the illegal gold mining is thriving in Kamalenge area in Kitumbi Sub County in Mubende district where several deposits of gold have been discovered. The exploration area covers 282.9069 sq km that was granted to AUC Mining Uganda limited.

Edwards Katto the acting commissioner Geological survey noted that there are vast gold reserves in Mubende area. He said following the discovery of gold, M/S Gemstones International Limited were granted exclusive exploration rights to explore and mine the gold in Kitumbi Sub County in Mubende under licence No. EL 1093 issued by the Ministry of Energy and Mineral Development.

“But information reaching us indicates that some deaths have been registered as a result of illegal mining activities that call for concerted efforts from the district leadership to actively engage in the sensitization of the communities against illegal mining activities,” Katto wrote in a letter to the  Mubende District Chief Administrative Officer.

Moses Masagazi the Gemstones International Project coordinator told New Vision that there is an influx of illegal miners in the areas of EL 1093 which he said is contrary to section 4 of the mining Act 2003. ‘We have written to all authorities but no action seems to be done. We want action taken so that mineral exploration can be carried out in the exploration area,” said Masagazi.

What is on ground?

There is an influx of over 1000 illegal gold miners in Lugingi A and C and surrounding areas near Katugo village in Mudadde parish and in lugingi A and Lugingi C villages in Kijuna Parish in Kitumbi Sub County. According to reports illegal gold buyers from as far as Congo, South Sudan, Rwanda, Burundi and Nebbi throng this place in search for gold. Most of these gold bought in points, grams and tollers finds its way in Kampala where it is refined by licensed gold dealers before exported to the middle East especially United Arab Emirates –Dubai.

Majority of the miners who purchase small plots of land from land owners in Mubende between sh2-10m also accuse the district officials of fueling the illegal trade and mining. “Many miners don’t stay here. We come from far, Congo, Rwanda Burundi and Sudan but are taxed by the district officials on a daily basis, so this trade can’t stop,” said one miner who preferred to remain anonymous. The miners revealed that they pay between sh5-12m daily to the “tax collectors”.

“I bought this small plot of land at sh5m but every day I am taxed again but we don’t even know what the money we pay does because we don’t even have toilets here,’ said Mulongo David. They named top district and Kitumbi Sub County officials of amassing wealth from the illegal trade.

What do the district officials say


Mubende district chairperson Kibuuka Amooti acknowledges that the mining is illegal but downplays any illegal tax collection. “What I am aware of is that the mining taking place is illegal and we are doing everything possible to stop it,” he told New Vision. He said as a district chair he was not aware that some of the district officials were collecting money from the miners.

“If it is true that they are collecting money, then it is wrong because as a district we don’t get that money,” said Kibuuka.

The RDC Patrick Buriku however defended the trade saying it is helping to develop the area.”What is wrong with people mining? Who doesn’t need money? People are dying right but where in the world don’t people die? Says Buriku.

Moses Kityo the Bukuya Gombolola Internal Security Officer noted that it is the petty traders within the mining areas that are taxed by the Sub County chief. “Money is collected from the traders to help generate revenue for the Sub County. The issue of miners being taxed is done by the land owners,” he said.

Action taken

The District police commander notes that the mining is illegal. In a new petition to the Inspector General of Police Gemstones have sought the assistance of government through the IGP to halt the activities.

The IGP Gen. Kale Kayihura has vowed to “crack the whip” to restore sanity in the area. “Investigations have commenced and we shall ensure that we restore law and order in the area,” said Kayihura. This paper has learnt that a team of detectives has been dispatched to Mubende to investigate and unearth the irregularities.

 "If the officials ( district) are getting illicit money then they should defend themselves," said Patrick Onyango the acting deputy police spokesperson

Uganda losing millions in illegal gold mining

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