Malawi could be losing more than US$700 million a year in potential economic value through the illicit trade in gold, according to a study by the Malawi Mining Investment Company (Mamico), highlighting both the scale of the country’s informal gold economy and the difficulties authorities face in bringing artisanal and small-scale mining into the formal economy.
The estimate, reported by The Nation and reiterated by Malawian authorities, comes from a month-long Mamico assessment that identified 81 sites where gold mining was taking place illegally. Mamico chief executive Leonard Kalindekafe said the study indicated that much of the gold was being purchased from artisanal miners by foreign traders before leaving the country through informal channels.
The US$700 million figure, however, should be treated as an estimate of potential value or revenue lost rather than as a verified measure of gold physically smuggled out of Malawi. Publicly available data do not provide an independently verified national estimate of illicit gold exports on that scale. Malawi’s extractive-sector reporting has also acknowledged limitations in production and export data, while informal gold production and trade remain difficult to quantify.
That distinction matters in understanding Malawi’s gold sector. The country does have gold deposits and a growing artisanal mining industry, but it is not currently a major industrial gold producer on the scale of Ghana, Mali or South Africa. Government economic reporting indicates that Malawi’s gold production remains overwhelmingly within the artisanal and small-scale mining sector, with deposits occurring in several districts, including Kasungu, Machinga, Mangochi, Nkhata Bay, Nkhotakota and areas of the Lower Shire.
The challenge is therefore less about the absence of gold than about the ability of the state to capture, measure and add value to production generated by thousands of small-scale operators.
Malawi began attempting to address this problem in 2021, when the Reserve Bank of Malawi, through its subsidiary the Export Development Fund, established a structured gold-buying programme intended to provide artisanal miners with a formal domestic market. The initiative was also designed to reduce incentives to sell to informal buyers operating outside the regulatory system.
The programme has expanded considerably. Malawi’s latest Extractive Industries Transparency Initiative reporting records 89,053 grams of gold purchased by the Export Development Fund during the 2023/24 financial year. More recent information released by the Mining and Minerals Regulatory Authority indicates that EDF purchases increased to more than 131,000 grams in 2024 and more than 245,000 grams in 2025.
Those figures suggest that formalisation is already occurring, although not yet at a scale sufficient to eliminate the informal market.
The reasons are structural. Artisanal miners often operate far from formal financial and trading infrastructure. Where licensed buyers are distant, transactions are slow or cumbersome, or miners believe informal traders offer better prices or faster payment, black-market channels can remain attractive. The problem is therefore not simply one of law enforcement; it is also one of market design.
The experience of Malawi’s gold sector illustrates a broader African reality. Artisanal and small-scale mining provides livelihoods for large numbers of people across the continent, but its informal character can leave miners outside systems of taxation, licensing, financial services, environmental regulation and social protection. At the same time, precious metals such as gold are particularly vulnerable to illicit trade because their high value can be transported relatively easily.
This creates a policy dilemma. A purely enforcement-led response can push miners further into informality, while an inadequately regulated market can allow traders to capture much of the value generated by mineral production. Formalisation is therefore more likely to succeed when licensing, access to buyers, transparent pricing, assaying, payments and enforcement operate as parts of the same system.
Malawi’s authorities appear to be moving in that direction. Mining Minister Thoko Tembo said this month that Mamico was working on mining cooperatives and formal gold-buying structures, with government-backed buying points intended to be established closer to mining communities. The stated objective is to make legitimate channels more accessible to miners and reduce their reliance on informal buyers.
There is also an important economic dimension. Malawi has faced persistent foreign-exchange constraints, making the ability to retain more mineral earnings within the formal economy particularly significant. The government has consequently sought to increase the role of minerals in export earnings while strengthening oversight of the sector.
The Export Development Fund has allocated substantial resources to gold procurement. In June, EDF said it had set aside K400 billion for gold purchases during 2026 and had bought 352 kilograms during the preceding three months, surpassing the volume acquired during the whole of the previous year. The Fund attributed the increase partly to stronger security arrangements and greater confidence among miners and traders in formal channels.
Yet the expansion of state purchasing also raises questions about transparency, pricing and institutional capacity. A functioning formal market requires more than a government buyer. Miners need predictable access to competitive prices; buyers need reliable assaying and traceability; regulators need accurate production data; and the public needs sufficient information to determine how mineral wealth is being managed.
Malawi’s experience also demonstrates why Africa’s mineral governance debate cannot be reduced to a simple narrative of resources being “stolen” by outsiders. Informal mineral economies are complex systems involving miners, financiers, transporters, local traders, licensed and unlicensed buyers, regulators and international markets. Weaknesses at any point in the chain can facilitate illicit trade.
Comparable challenges are visible elsewhere on the continent. Gold-producing countries across West, Central and East Africa have reported difficulties with illegal mining, cross-border smuggling, weak traceability and discrepancies between recorded production and international trade data. Governments have responded with combinations of formalisation programmes, traceability systems, enforcement operations and reforms to mineral-trading regimes.
For Malawi, the immediate task is therefore not simply to stop gold leaving the country. It is to build a gold market in which miners have a credible reason to sell legally, the state can accurately account for production, communities receive a meaningful economic benefit and mineral exports generate foreign exchange through transparent channels.
If the US$700 million estimate is ultimately corroborated by stronger production, trade and customs data, the potential opportunity would be significant for a country whose mining sector remains relatively small in relation to the wider economy. But even if the eventual figure proves substantially lower, the underlying issue remains important: Malawi is attempting to transform an increasingly valuable artisanal mineral economy into a formal sector capable of contributing more reliably to national development.
The success of that transition will depend less on the rhetoric surrounding Malawi’s gold wealth than on whether miners themselves find the formal economy accessible, competitive and trustworthy. That is ultimately where the country’s effort to curb smuggling will be tested.
