Rwanda’s ambitious plan to establish itself as a gold refining hub has encountered significant challenges, leading to a joint venture project’s suspension and subsequent legal disputes.
The Aldango gold refinery, a partnership between Aldabra and Rwandan government-owned Ngali Mining, began operations in June 2019.
However, in January 2021, Rwandan officials revoked Aldango’s export license and made several arrests within the company.
Alain Goetz, a Belgian gold dealer involved in the venture, claims that the confiscation of the refinery has resulted in a loss of approximately US$20 million, which will be a burden on the investors who believed in the project.
The Rwandan government cited tax evasion as the reason for their actions, but Goetz disputes these allegations, highlighting the minimal profit margins in gold trading and the lack of an agreed-upon royalty tax.
Goetz has taken his case to the International Centre for Settlement of Trade Disputes, seeking resolution.
Reflecting on the situation, he regrets not heeding the warnings of others who advised caution when dealing with the Rwandan government.
The establishment of the Aldango refinery followed a meeting between Goetz, Rwandan representatives, and President Paul Kagame.
The Rwandan government expressed enthusiasm for a refinery similar to the one in Uganda, initiated by Goetz.
However, as the project progressed, disputes arose regarding tax exemptions and written commitments from the Rwandan government.
Issues escalated as tax demands were made, and Rwandan authorities became hostile towards Aldango employees.
The company’s bank accounts were blocked, and the RMB suspended its export license. Several Aldango staff members were arrested without charges, further intensifying the tensions.
Goetz recounts a meeting with Clare Akamanzi, the CEO of the Rwanda Development Board, in which Akamanzi expressed disappointment in the project’s financial performance and requested a dividend payment.
However, Aldango clarified that they were still in the investment recovery phase and were not generating profits.
Despite the project’s setbacks, Rwanda has continued its efforts to position itself as a gold refining hub, evident in the gold refining agreement signed with the Democratic Republic of the Congo (DRC) in June 2021.
However, the strained relationship between the two countries over the M23 rebels in the eastern DRC has hindered the agreement’s implementation.
The legal battle between Alain Goetz and the Rwandan government continues, shedding light on the challenges faced in realizing Rwanda’s vision of becoming a prominent player in the gold refining industry.