As South Sudan’s political crisis deepens and the risk of renewed civil war grows, the country’s leaders are betting on gold as the next engine of economic growth. But across the border in Sudan, gold has become a financial lifeline for a devastating war instead. Control over mines and over smuggling networks bankrolls armed actors and enriches regional profiteers, perpetuating the world’s worst humanitarian crisis. Gold is helping fuel the conflict.
South Sudan now risks following a similar path. The country’s efforts to commercialize gold production by opening new gold refineries and gold-backed infrastructure deals could generate much-needed revenue. But there are critical variables to consider: armed groups control mining areas, oversight is weak, and the sector is dominated by politically connected elites. Without robust safeguards, corruption, money laundering, and conflict will increase, turning gold into the latest fuel for a growing war economy.
Gold is found in five of South Sudan’s 10 states, but mining is dominated by artisanal and small-scale miners, resulting in limited data about the volume of gold produced. Calculations using United Nations trade data show that, between 2019 and 2023, only 4 tons of gold was mined, most of which was sent to the United Arab Emirates. But given significant smuggling to Kenya and Uganda, these numbers are likely underreported.
Recently, the Ministry of Mining approved gold refineries in the country for the first time, permitting two facilities — one operated by an Egyptian firm and the other by local investors. The refineries, if operational, could change the game for the country’s gold industry, moving the sector to commercialization. The government is also pursuing projects using gold as collateral, recently announcing a $2 billion road infrastructure deal with a South African company, backed by gold. Given the many issues with illicit gold in South Sudan, however, the new refineries and deals present very high risks for money laundering and conflict gold flows.
These ventures are occurring in a weak regulatory environment. The U.N. Commission on Human Rights in South Sudan, for example, reported in September 2025 that oversight institutions — such as the Anti-Corruption Commission, the National Audit Chamber, the judiciary, and the legislature — do not function effectively, at least in part because, to varying degrees, they lack the funding, independence, or political support they need. According to the Global Initiative Against Transnational Organized Crime, mining companies often are even co-owned by senior government officials who ignore conflict-of-interest regulations, leading to corruption, impunity, and ongoing disputes. These high-ranking officials frequently use their power to undercut laws and secure concessions in return for stakes in mining ventures.
The Links to Violence
While South Sudan desperately needs foreign currency, and gold could possibly provide the necessary funds, expanding gold production without robust accountability and regulatory reforms is likely to intensify existing corruption and tensions. The risk of violence is particularly high between large corporations and small-scale artisanal miners, who often lack protection under the law and face displacement from their livelihoods by companies connected to political elites. Rapid expansion of the gold mining sector also threatens to exacerbate environmental degradation, as violations are likely to increase in the absence of effective oversight.
Even more concerning is the fact that the gold trade is inextricably linked to conflict. Many of the country’s mining sites are controlled by rebel groups, including armed local communities, the national army, the National Security Service, and rebel groups of the Sudan People’s Liberation Movement-Army in Opposition (SPLM/A-IO), and the National Salvation Front. Formalizing and expanding mining operations in these contested areas could spark further armed clashes and undermine prospects for peace in South Sudan. Conflict-linked gold from Sudan is also being funneled through South Sudan via the political networks that dominate the sector, the New York Times wrote recently, drawing the country into regional conflict.
This illicit flow of Sudanese gold deepens instability on both sides of the border. Against this backdrop, the United States is working to pursue a peace deal in Sudan with Egypt, Saudi Arabia, and the UAE, a grouping known as “the Quad,” although the trail has gone cold recently. If profits from conflict gold keep weapons in the hands of armed groups, these peace efforts will be at risk, prolonging the region’s cycle of violence that has reached the level of atrocities, including crimes against humanity.
More broadly, an unstable South Sudan presents the risk of regional contagion. Renewed conflict, such as an escalation earlier this year that forced 280,000 people from their homes, may erupt again as the country’s elections approach in December. That may trigger further refugee flows, illicit arms trafficking, and economic disruption across neighboring countries such as Ethiopia, Uganda, and Kenya, important U.S allies in an already fragile region.
South Sudan also sits within a wider geopolitical contest in East Africa and the Horn of Africa regions. The war in Sudan has already drawn in regional powers Egypt and Ethiopia. Furthermore, the involvement of Islamist factions, Russian mercenaries, the UAE, and overall expanding Chinese and Iranian influence in the wider Red Sea and Horn of Africa region are issues that affect U.S. interests. If South Sudan deteriorates further, that crisis could spread, rather than remain contained.
Thus, Washington has a strategic interest in keeping South Sudan and its neighbors stable. U.S engagement — via diplomacy or financial and economic pressure if needed – also would give Washington leverage over South Sudan’s leaders to respect peace deals, good governance, and democracy. Past U.S. pressure, including sanctions in 2018, helped push the belligerent parties in the country’s war toward a peace settlement. Sustained U.S. involvement can therefore support both conflict prevention and governance reforms, reducing the risk that South Sudan becomes another front in a broader regional crisis.
What the U.S. and Its Allies Could Do
The United States, especially if it can work with other international allies of South Sudan such as the U.K. and the European Union, should focus on three steps.
First, the United States should create a high-level, interagency task force on illicit gold, spearheaded by Secretary of State Marco Rubio in close coordination with Treasury Secretary Scott Bessent. As a U.S. senator, Rubio described the illegal gold trade as a “direct threat” to U.S. national security and urged the first Trump administration to take action against it. Today, that threat is growing on an unprecedented scale and demands attention. Coordinating such U.S. government efforts with industry bodies, financial institutions, and regional and international organizations holds the greatest chance of generating impact.
The task force could coordinate and press for increases in U.S. resources to track, investigate, and sanction both corrupt officials and criminal organizations behind the illicit gold trade across the globe. It should also support the legitimate artisanal mining sector and foster greater collaboration with the private sector, ensuring real-time intelligence sharing on bad actors and reinforcing the integrity of the global gold market. The U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) could play a leading role in issuing alerts, facilitating information exchange with banks and refiners regarding tracking methods, and urging the submission of reports by trading entities concerning suspicious transactions. This would build on actions by the United Kingdom, which recently established a public-private partnership on illicit gold.
Second, it is imperative to establish consequences for illicit gold networks. Sanctions that are fully enforced are one critical step, such as those imposed by the U.K. and the United States that have already targeted a handful of UAE-based firms, and U.S. and EU restrictions on a Rwandan gold refinery. But these actions must be broader and more closely coordinated. The U.S. and U.K. have sought closer ties in recent months with the UAE because of the Iran war, but smaller-scale sanctions specifically targeting certain criminal networks should still be possible.
Third, it is time for a consolidated, effective international process to monitor and validate international gold trading hubs, as illicit gold from South Sudan — as well as from Sudan, the Democratic Republic of the Congo, and other countries — is almost exclusively smuggled to the UAE. This process, which should involve the 12 major gold refining hubs from the UAE to India to Singapore, should standardize gold import verification procedures, publish significantly improved gold trade and production data, and evaluate whether key gold bullion trading centers are doing effective checks to combat illicit gold. The gold industry body London Bullion Market Association recently initiated a dialogue with these gold refining centers, and the UK and other key governments should collaborate with industry and civil society to produce outcomes that would change the game for conflict gold traffickers and refiners.
At the regional level, South Sudan should conduct multi-stakeholder mine inspections, consistent with the International Conference of the Great Lakes Region regional minerals certification process, to independently certify gold mines as conflict-free prior to the export of gold. This would require amending South Sudan’s Mining Act to legally incorporate internationally recognized due diligence procedures, including those established by the Organisation for Economic Co-operation and Development (OECD). It would also require validating mine sites through joint committees comprising government, civil society, local communities, and industry representatives to ensure they do not finance armed groups, while establishing clear chain-of-custody procedures and independent third-party audits.
With responsible management, both private and governmental, of valuable resources such as gold, real peace – and even economic prosperity – could be possible in South Sudan. But that will happen only through concerted policy initiatives involving coordinated actions.
