Rwanda’s promising gold export industry has been dealt a serious blow after the European Union (EU) imposed sanctions on the Gasabo Gold Refinery, one of the country’s main refining facilities.

The move, which also targeted Francis Kamanzi, CEO of the Rwanda Mines, Petroleum, and Gas Board, signals a EU tougher stance on Rwanda’s alleged role in the illicit minerals trade.

The Gasabo refinery has been processing gold from across the region since it opened in June 2022, allowing traders to fetch higher prices for refined exports rather than selling raw gold at lower rates.

But with these latest sanctions, Rwanda’s entire mineral trade could come under scrutiny, with its gold exports potentially flagged as conflict resources—a classification that could make them unfit for sale on the global market.

The EU’s statement was explicit in its accusations. It described Gasabo as a transit point for gold mined illegally in the Democratic Republic of Congo (DRC) and accused Rwanda of facilitating illegal exports.“Gasabo Gold Refinery based in Kigali...is where the gold illegally extracted in Congo is transited through, hence contributing to the illicit export via Rwanda,” the EU said.

The implication was clear: Rwanda was not only refining gold, it was also playing a role in fuelling the conflict in the DRC.

Read: Congo rebels muddy minerals market with illegal Rwanda exports, says UN reportRwanda’s ambitious plansThe stakes are high. In 2023, Rwanda earned $885 million from gold exports, making the commodity its top export product and placing the country 64th among the world’s largest gold exporters. The United Arab Emirates (UAE) was a major destination for Rwandan gold.

With ambitious plans to grow mining revenues to $2.2 billion by 2029, these sanctions could derail Rwanda’s economic trajectory and force the government and industry players to rethink their strategy.

Beyond the immediate economic impact, the sanctions have also put Rwanda’s mineral trade agreement with the EU in limbo. Under the deal, Rwanda was set to become a major supplier of precious minerals to the European bloc. However, pressure from the European Parliament—which has pushed for the deal to be scrapped—suggests it may now be abandoned altogether.

EU ‘hypocrisy’Yet, not everyone agrees with the EU’s actions. Some experts see the sanctions as hypocritical, arguing that the EU itself has played a role in the very trade it now condemns.“There is a high degree of hypocrisy in the latest EU sanctions, given that exactly one year ago, the EU signed an MoU with the Rwandan government to ensure the sustainable supply of natural resources from eastern Congo,” said Phil Clark, a professor of international politics at SOAS University of London.

Prof Clark pointed out that much of the illicit mineral trade is enabled by the EU’s own processes, where illegally sourced minerals are mixed with legally traded ones.“This makes the EU a direct contributor to the illegal mineral trade and to the eastern DRC conflict of which it is a part. The EU is thus sanctioning M23 and Rwanda for a situation the EU itself helped to create,” said Prof Clark.

Read: DR Congo sues Apple in Europe over conflict mineralsAgainst this backdrop, President Paul Kagame has called on Rwandans to “tighten their belts” and brace for the impact of the sanctions, warning that tough times may lie ahead.

Speaking at a citizen outreach event in Kigali, Mr Kagame described the situation as yet another challenge that Rwanda must face with unity and resilience.“Rwandans have to remain united and build their country, then confront those who want to destroy us. Everyone should know that this will not be easy,” he said.“It will be burdensome and tasking, just like how costly liberating this country was, some people lost their lives so Rwanda can stand,” he added.

Countries like Belgium, Canada, the United Kingdom, the United States had earlier imposed sanctions on Rwanda for its alleged role in backing the M23 rebels, who have captured two major cities in South and North Kivu provinces of DRC.

He dismissed fears that the restrictions would cripple the country, stating, “You think we shall drop dead the following day because of sanctions?”The President also took a direct swipe at Belgium, Rwanda’s former colonial ruler, arguing that Western powers continue to undermine the country’s sovereignty.“One of our biggest misfortunes is that we were colonised by a small country like Belgium, which cut our country up so it can be small like it (Belgium). Belgium has killed our country throughout history, killing our people. And keeps coming back to kill even those that didn’t die.”As tensions rise between Rwanda and its Western partners, the country now faces a difficult road ahead.

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