How 'blood gold' from Africa is funding Russia's war on Ukraine
A new report details how the Wagner mercenary group uses gold mining in Africa to funnel money to the Kremlin.
According to "The Blood Gold Report," Wagner has laundered some $2.5 billion to Russia since its full-scale invasion of Ukraine last year in an effort to support its war effort.
This is in spite of global sanctions that have shut off the Russian economy from much of the world.
The report was produced by the Consumer Choice Center, as well as 21Democracy — a nonprofit that tracks corruption and advocates for government transparency.
Jessica Berlin, a political analyst and co-author of the report, joined All Things Considered host Scott Detrow to elaborate on their findings and how far the scheme has gone.
This interview has been edited for brevity and clarity.
Scott Detrow: So the report focuses on three countries: Sudan, Mali and the Central African Republic. Wagner has a presence in a number of countries. Why were these three so important for what you were trying to look at here?
Jessica Berlin:Well, these countries are where Russia's blood gold trade has really taken off. They're the primary targets for Russia's operations in the gold industry. And also, they demonstrate very clearly the model of how Wagner operates on the continent and is able to exert increasing economic and political influence there.
Detrow: When you use the phrase blood gold, tell us what you mean by that.
Berlin:The term blood gold is coined to describe the gold that's being mined and laundered into international markets to finance the Russian state and, in turn, enable the Russian state to wage its war of aggression on Ukraine, as well as to commit atrocities against people in Syria and across the African continent.
And we've coined this phrase blood gold to help people understand the connection between the business side of Wagner and the truly deadly foreign policies and international crimes being being undertaken by the Russian state.
These actors are one in the same. There's there's no separation between the "private military contractor" Wagner and the Kremlin's wars against the Ukrainian and the Syrian people, for example.
We need to understand that this is part of a cohesive global strategy and that if you enable one, you're enabling the other.
Detrow: Tell us about that model. And I know it probably differs a little bit from country to country, but there's a typical playbook that we're seeing here. Tell us how it works.
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Berlin: Well, firstly, it's important to understand that Wagner's engagement in Africa predates the full scale invasion of Ukraine. They've been doing this already for years now, for example, in the Central African Republic [CAR].
Wagner has already been collaborating and operating with the regime there since 2017. They were given basically exclusive mining rights for the country's largest gold mine in return for propping up the regime there.
They're basically what can be considered as a private security company, giving the regime both physical and political protection. They're targeting opposition groups, unleashing a lot of the kind of disinformation and hybrid warfare tactics against opponents and critics of the regime in CAR that you would see also worldwide in Russian disinformation and hybrid warfare tactics against any of their their enemies, perceived or real.
Detrow: How is the gold making its way out of these countries onto the market and back to the Russian government?
Berlin: That's the million dollar question. Or in this case, the $2.5 billion question. So Russia, as we know, has a broad, broad scale of money laundering abilities that go far beyond just gold.
In this case, we're seeing a great deal of gold being sold, smuggled and refined and effectively laundered through the Middle East, in particular the UAE, in the Dubai gold market. Also via China and Hong Kong, there are very, very extensive and complex front companies, shell companies being used to move the money.
And the gold gets moved quite literally on trucks and planes to these countries, where then it can be melted down and mixed in with gold that has been sourced legally. And this makes gold quite relatively easy to hide. And, of course, in the Malian example, they don't have to do that because they're being paid in cash, effectively via the tax income generated by the legitimate Western mining companies who are paying state taxes on their business enterprises there.
Detrow: And of course, there's been two years of international sanctions on Russia. Right now, our current sanctions are allegedly trying to trying to address this income stream. What is the state of things right now? What are you seeing? What's working, what's not?
Berlin: The good news is that sanctions against Wagner Group and individuals in Wagner's orbit are taking effect, and it has become increasingly difficult for Wagner to get their money out of Africa.
The bad news is it's obviously not enough — $2.5 billion just over the course of the last year and a half is, of course, an enormous sum. And in order to to reduce Wagner's ability to profit off of goals on the continent, we need to heavily increase the sanctions and how we target the actors involved in the blood gold trade.
This means not just going after Wagner on the supply side, but going after the regimes who are contracting them on the demand side. So if governments in Africa and elsewhere in the world, for that matter, if they know that doing business with Wagner is going to cost them personally, both financially, both also in terms of their and their families' abilities to travel, they might think twice about signing that contract.
And this is a way to quite simply make it unviable, less attractive and less profitable for these states to engage in business with Wagner in the first place.
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