The high price of Uganda's gold rush

Uganda's President Yoweri Museveni inspects gold flakes at a refinery in Entebbe. The sector has grown rapidly but a new report alleges rampant corruption.

Story highlights

  • NGO alleges systemic corruption in Uganda's mining sector
  • Report cites instances of bribery, human rights abuses and environmental damage
  • Uganda's gold rush has seen exports climb over 140000% since 2014

(CNN)Uganda's mineral industry has enjoyed a spectacular surge in recent years.

Gold exports reached $340 million in 2016, according to official figures, up from $237,000 in 2014. New mining sites are opening across the country, creating jobs for thousands of people.
    But a new report from environmental NGO Global Witness claims there is a dark side to the boom, that the mineral sector is fueling corruption, conflict, human rights abuses, and environmental damage.
    The 18-month investigation "Uganda: Undermined" draws on interviews with miners, company executives, government officials, and industry experts to paint a stark picture of the sector.
    "Our investigations show that Uganda's mining sector is characterized by corruption, mismanagement and high level political influence," says George Boden, Uganda campaign leader at Global Witness. "Impunity is endemic and attempts at reform have all failed in the face of entrenched interests."
    The Kilembe mine on the border of protected site Rwenzori Mountains National Park.

    License to shill?

    The report alleges systemic corruption at the Directorate of Geological Survey and Mines (DGSM), the government body that awards mining licenses, operating under the Ministry of Energy and Mineral Development (MEMD).
    "Corruption has become institutionalized at the Directorate," the report claims. "It is almost impossible to obtain licenses from the DGSM without making payments to certain DGSM mining officials...(and) Directorate officials are expected to provide preferential treatment to companies favored by the political elite."
    Global Witness cites cases of senior DGSM staff simultaneously serving as directors at companies applying for licenses, in apparent conflicts of interest.
    The NGO also reports complaints from staff who say their decisions were overridden in favor of investors with political connections.
    A spokesperson for the MEMD acknowledged problems with the licensing process and told CNN it is under review.
    "Some of the issues raised by the report such as licensing are bought about because of weaknesses and loopholes in mining policy and laws," the spokesman said. "The ministry is currently reviewing these policies and we hope that some of these challenges will be cleaned up."