Guinea demands local refining as raw gold exports banned
Guinea is one of a growing number of African countries to insist on domestic processing of commodities prior to export.
Guinea, a West African country rich in minerals, is grappling with the challenge of ensuring that its resource wealth stays within its borders. Despite possessing the world's largest untapped high-grade iron ore reserve, Guinea has struggled to translate its resource wealth into a prosperous population. Traditionally, commodities, including gold, have been exported in raw form, lacking local value addition.
In an effort to address this issue, President Mamady Doumbouya, who came to power in a coup in 2021, recently banned the export of raw gold. This decision aligns with the construction of a gold refinery in Conakry, which boasts a refining capacity of 250 tonnes per year. In the first quarter of 2025, Guinea exported 22 tonnes of gold, a figure that has since decreased to around $4,400 per ounce.
Failure to comply with the new law could result in severe consequences for mining companies, including the revocation of licenses and termination of mining contracts. This stance reflects Guinea's history of enforcing mining regulations, as evidenced by its takeover of Guinea Alumina Corporation last year and its ongoing dispute with Emirati company Falcon Energy Materials over the Lola Graphite Project.
Guinea is not alone in adopting stringent measures towards local refining. Ghana, Uganda, and Tanzania are also considering similar bans on unprocessed gold and mineral exports. The Democratic Republic of Congo has even banned exports of copper concentrate and cobalt concentrate, pushing for domestic processing.
Guinea's mining sector strategy aims to channel at least 0.5% of mining company profits into local development funds and build more processing plants. The government is confident that the renewed interest in the mining sector, particularly with the progress at Simandou, will encourage companies to comply with the new rules. S&P Global has raised Guinea's outlook from stable to positive, attributing this to the strong economic growth driven by the mining sector, which accounts for about 20% of the economy and 90% of exports.
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