A gold refinery, African Gold Refinery AGR, considered the second in Sub-Saharan Africa after one in Johannesburg in South Africa, has been commissioned in Entebbe, Uganda.
A gold refinery, African Gold Refinery (AGR), considered the second in Sub-Saharan Africa after one in Johannesburg in South Africa, has been commissioned in Entebbe, Uganda.
President Yoweri Museveni commissioned the 20-million-dollar refinery Monday at a ceremony at the facility near Entebbe International Airport.
The facility refines 99.99 percent of gold from gold ore. The refining process includes several steps such as graining, melting, chemical baths and processing. After the refining and casting process, the gold is sold to and physically delivered to the Middle East market.
Clients are paid 90 percent of the gold contents identified directly with the remaining 10 percent paid after deep sampling and fire assay.
AGR started in Uganda in 2014 and now refines and exports a tonne of gold monthly. Last year the company exported gold worth 300 million dollars, approximately over one trillion Shillings.
AGR is a subsidiary of Tony Goetz (TG) N.V., a leading Belgian precious metals trading and refining company based in the city of Antwerp, also known as the world's precious metals capital. The company also has a refinery in Dubai, United Arab Emirates.
Annually, TG has a turnover of two billion dollars.
President Museveni hailed the refinery as a step in the right direction and an example of integration of the economy, emphasising that value addition fetches more money.
Museveni said with the gold refinery in place gold dealers should flock to AGR instead of using underground channels like smuggling.
Museveni warned government officials against delaying manufacturers, processors and investors, adding that anybody who does so will be dealt with harshly.
The President also ranted against certain policies that constrain investments, citing imposition of royalties and direct taxes on minerals. He said his interest is in employment, foreign exchange and indirect taxes.
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Museveni said he is also opposed to imposing taxes on mineral prospecting and directed that royalties charged on artisanal miners in Mubende and other gold mining cites be stopped.
The Chief Executive Officer of AGR, Alain Goetz, said the refinery is vital for the mining industry in Uganda and the region.
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Goetz said they chose Uganda because of the country's peace, stability and visionary leadership, adding that they project Uganda as an important hub for gold and mineral processing in Africa.
Goetz said their biggest challenge so far is wanton smuggling of gold via Entebbe International Airport which creates unfair competition since the smugglers do not pay any taxes. He said this also poses dangers like money laundering and financing of terrorism.
Goetz appealed to government to promote the refinery regionally in order to attract more gold.
Richard Kaijuka, the Vice Chairman of Uganda Chamber of Mines and Petroleum and a key player in AGR, said the refinery in addition to being located in the heart of Africa is also the very first in Sub-Saharan Africa minus South Africa.
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Kaijuka said gold exports is projected to surpass coffee and urged government to focus more on exploration and value addition of minerals. He said if well exploited minerals will earn Uganda more revenues than oil and gas.
The Belgian Ambassador to Uganda, Alain Hanssen, said creating an investment-friendly environment is crucial for Uganda, adding that there is also a need to ensure full transparency of where the gold comes from.
The ambassador said locating the gold refinery in Uganda is not by accident because before the Idi Amin regime minerals constituted 20 percent of exports.
The Minister of Energy and Mineral Development, Irene Muloni, said the benefits AGR will bring for Uganda are enormous, citing, among others the 75 people, especially youths, directly employed by the refinery and taxes.
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The minister touted the idea of removing taxes on gold exports in order to increase competitiveness and attract more gold from the region.
The minister's proposal on non-tax exports of gold received negative reaction from those in attendees. A number of government officials said removing taxes on gold, a highly valuable and attractive mineral, is counterproductive.
The Mayor of Entebbe Municipality, Vincent Kayanja, hailed AGR for adding value to the Ugandan economy and pledged to standby and support the refinery.
