Business

No room for smuggled stones here, says Uganda

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By By Sam Wakhakha

Posted  Monday, May 17  2010 at  00:00
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Uganda will not polish smuggled stones from the Democratic Republic Congo even though it now has a gold refinery outfit in Kampala.

Minister of State for Mineral Development in the Ministry of Energy and Mineral Development Peter Lokeris said the country has a mineral refining protocol with the DRC that they will follow to avoid illicit trade.

“We will only be dealing with exporters in a transparent manner; we will not allow conflict minerals to enter here,” he explained.

According Victoria Gold Star managing director Yuri Bogoroditskiy, to ensure no smuggling, the firm’s stores will double as as bonded warehouses for the mineral.

In the past, Uganda was mentioned as one of the transit routes for gold that is smuggled from the DRC. For instance a United Nations Security Council Report last December named Kampala as the first transaction point for the illicit trade gold trade from eastern DRC.

The refinery established at approximately $1.5 million has an installed capacity of processing 21 tonnes of gold annually. According to the management, the refinery will start off with small scale begin refining.

Mr Bogoroditskiy said that they chose to invest in Uganda because of its strategic location near countries rich in the mineral, relative political stability and good investment policies of the country.

“We chose Uganda because of its proximity to countries like Tanzania, Rwanda, DRC and Kenya that are rich in the mineral,” he said.

Uganda currently mines and exports unprocessed gold but with the opening of the plant, the country expects to export polished stones, hence bringing more earnings to the country.

Uganda has got a gold mine in Busia and another one is due to open in Mubende. National survey also point to more gold mines in Mbale, Kibale, Hoima, Rukungiri, Kisoro, West Nile, Kotido, Amuru, Kitgum and Kabarole.

According to statistics from the Uganda Export Promotions Board, Uganda exported 931 tonnnes of gold and gold compounds worth $23 million last year while in 2008, it exported 2,055 tonnnes worth $50 million.

The exports had however peaked in 2007 whereby the country earned $88 million from the mineral.

As a country, Uganda has in the recent past seen an upsurge in the number of investors in the mining sector.

According to the recently released budget framework paper, the government issued 101 mining licenses last year. Other minerals that are being explored include copper,