The road​ that leads to the city of Shire, the centre of Ethiopia’s gold rush, is pockmarked and warped. My driver told me the origins of each fissure: a drone strike here, an artillery shell there. He was stationed near Shire during the recent war, as a soldier with the Tigray Defence Forces, the popular army that rose up in 2020. All the seatbelts in his car had been cut off and repurposed as shoulder straps to ease the weight of AK-47s. The war pitted Tigray against the Ethiopian federal forces and their allies in neighbouring Eritrea. It ended in 2022, two years after it began, by which time some half a million people had been killed. The uneasy peace had been marred by sporadic political violence and a scramble for resources. Now, the region is teetering on the brink of another war.

Across Tigray, the remains of razed towns are marked with mounds of earth piled over the dead – impressions of war still visible in satellite photographs. A shadow economy has also etched itself onto Tigray’s postwar topography: new mining pits and the heavy machinery that comes with them. On the drive from Mekelle, the capital of Tigray, to Shire, we passed dozens of orange diggers gnawing away at terraced hills where crops once grew. At a bend in the river, young men were climbing down the slopes with heavy jute bags on their backs. They piled their earth and stones along the riverbank. The bigger stones were carted off to a rock crusher rumbling under a tin roof further downstream; smaller stones were broken apart with hammers and pickaxes. Women and children were sloshing ore around in blue basins, binding quicksilver mercury to bits of gold to form lumps of alloy. The alloy was gathered up for transportation to a nearby town, where it would be melted into nuggets of pure gold.

Half a kilometre away was a larger operation, a Chinese mining camp manned by ex-soldiers. I asked a teenage boy panning in the river about his community’s relationship with the foreigners working downstream. He told me he sometimes pays to use their equipment and that they sell him mercury. Digging and panning for gold by hand is legal, but mercury is not, nor is the unregulated use of excavators. Gold was a minor industry in Tigray before the war, but the economic crisis and political fragmentation that followed resulted in a rush to open new pits, many of them funded by mysterious foreign backers and secured by local military might. The most lucrative ones are in the northern and western hinterlands, off difficult dirt roads. To reach them you need a decent truck or motorbike, as well as written permission from the military commanders now in control of these territories (though we managed without). A senior Tigrayan official described the sites as ‘large-scale’ artisanal mines – a contradiction in terms, as he acknowledged.

Scaling up Tigray’s mining sector – never a major industry – was justified internally as a temporary measure to finance the region’s reconstruction. Ethiopia’s federal government had refused to release much needed funds to the Tigrayan leadership. Before the war, my driver told me, men like him would go into the wilderness to look for gold in advance of major life events. His brother spent a few weeks before his wedding digging and panning in the hills around the historic city of Axum. He took the dust he collected to a jeweller in the city, who melted it down and turned it into a ring.

In a bar in Shire, a former soldier who used to work at one of the biggest mines showed me some photographs on his phone. In the earlier ones, the land looked smooth and flat, a plateau between two terraced hills. Then diggers and metal sluice structures start to appear around tailings ponds, which seemed to expand, dry up and expand again. The land collapsed in on itself. ‘Investors’ (a catch-all term for the men who flocked to the region after the war) paid for most of the machinery that made its way to the site. In exchange, the ex-soldier told me, they took the lion’s share of the profits. ‘They presented themselves as investors. In reality, they are invaders.’ The proceeds intended for reconstruction never materialised. They are said to have lined the pockets of military men and smugglers, who stashed the money in offshore accounts. Labourers – most of whom are ex-soldiers – earn less than £5 a day. At some sites a white powder is said to be stirred into their tea, allowing them to work on only a few hours of sleep.

At Shire’s open-air gold market, traders were milling about under the midday sun, waiting for Dubai to announce its prices. Brokers haggled over quality assessments and discounts for bulk purchases. Some were weighing little bags on rusty scales, phones tucked under their chins, talking to prospective buyers abroad. On a street nearby was a row of low-tech smelters – shops with roaring furnaces that melt alloys into roughly refined bars suitable for transport. From Shire, it slips away: mostly to Dubai, but also to China, India, Turkey.

At the time of the ceasefire in 2022, an ounce of gold was selling for around $1600. In the years since, its value has more than doubled. It shot past $4600 in January, when the US Department of Justice subpoenaed the chair of the Federal Reserve, and climbed to more than $5000 in February before dipping slightly with the Iran war. It may climb higher: the geopolitical forces driving up prices show no signs of slowing. Research by the World Economic Forum and other bodies shows significant increases in global financial and political instability since Trump returned to the presidency. Gold buyers, including central banks, hope to weather the storm by placing their wealth in something tangible.

Other buyers are seeking to reduce their dependence on the dollar. China watched Russia lose access to hundreds of billions of dollars after its invasion of Ukraine in 2022 and began to ramp up its gold purchases in response. By the end of 2025, China’s reserves had risen to more than 2300 tonnes – around 6 per cent of the global total. According to the ECB, central banks accounted for more than 20 per cent of demand last year; a decade ago the figure was 10 per cent. Much of this was driven by the BRICS countries – now comprising Egypt, Ethiopia, Iran, Saudi Arabia, the UAE and Indonesia as well as Brazil, Russia, India, China and South Africa. There has been talk of creating an alternative, possibly gold-backed currency to rival the dollar, though internal divisions may prove insurmountable. One difficulty is that the group contains staunch geopolitical rivals – just consider Ethiopia and Egypt’s spat over the Grand Renaissance Dam or Saudi and Emirati competition in Sudan and Yemen – and members are divided in their attitudes to the US. Large economies such as Brazil and India are unlikely to burn bridges with Washington, nor is there sufficient trust between member states to pool reserves. For its part, China would like to position the renminbi as the only de facto dollar alternative (some 50 per cent of trade within the BRICS area is reportedly settled in renminbi).

The BRICS International Alliance for Strategic Projects – a Russian-led economic spin-off – has been particularly assiduous in courting gold-rich countries in the Horn of Africa and the ‘Coup Belt’ between Guinea and Sudan. Some of its representatives are involved in the mining sector and several have worked with Western-listed mining companies active in East Africa. Gold mines in Sudan, which have played an important role in financing the brutal civil war, are backed by money linked to the UAE and Russia. In Ethiopia, China is the biggest player. The investigation that first brought me to Tigray after the war concerned two mechanised mines which had been illegally expanded. The people running them were reportedly working with subsidiaries of a Chinese-Canadian joint venture. Correspondence I’ve seen shows that mining companies linked to the Chinese state are buying up stakes in publicly traded Western mining companies active in the area.

At first, gold from Tigray’s illicit mines was smuggled overland through Eritrea. Cross-border transactions were managed by a UAE-based businessman, who facilitated an alliance between one faction of the Tigrayan leadership and the Eritrean regime. When gold smugglers arrived in Asmara from Tigray, they were asked if their gold came from private investors or ‘the Chinese’. Private gold went on to Dubai, Chinese gold to China. Some left through Port Sudan, moved by networks of soldiers, professional smugglers and the nomadic Rashaida and Beja people.

In mid-2024, the Ethiopian government issued price incentives to draw business away from smugglers and deprive the leadership in Tigray of the proceeds of the illicit economy. The national bank agreed to buy gold at a rate higher than market value, and also floated the national currency, the birr, which made selling to the bank even more attractive. For a while the plan seemed to be working. By the end of 2025, Ethiopia reported record volumes of gold exports – 38 tonnes, worth more than $3 billion – and gold surpassed coffee as the country’s biggest export. But these figures are only part of the story. In 2025, smuggling routes through Eritrea fell away. Most illicit Tigrayan gold made its way south, to the national bank, while some was smuggled through Somaliland. Here, Tigrayan gold is mixed with locally produced gold and roughly refined; it is then issued with a new certificate of origin and can be exported to the UAE. At the same time, federal purchasing premiums drew in gold brokers from across the region. Brokers who previously moved gold into Dubai from Sudan, Chad and the Democratic Republic of Congo (by way of Uganda and Rwanda) began to sell in Ethiopia. ‘We are businessmen,’ a smuggler told me. ‘If it’s cheaper to sell to the national bank, we do that.’

The dramatic fluctuations in official gold export figures from other East African countries over the past few years should raise questions. Kenya, for example, is recorded as having exported more than forty tonnes of gold to Dubai in the first nine months of 2025, up from fourteen the previous year. Sudan and the eastern DRC are classified by the OECD as ‘conflict affected’ and ‘high-risk areas’, meaning gold from these areas can’t as easily be traded on regulated markets. Suppliers have to show that the gold is not funding armed groups, which is nearly impossible to prove when such groups control gold-producing areas. Last year, the UAE imposed what amounted to an embargo on trade with Sudan, which appears to have redirected the transfer of gold to illicit channels. Smugglers in Ethiopia told me they are now moving vast volumes of gold that would have otherwise left through Sudan to neighbouring countries. Excluded from regulated markets, producers in war economies find themselves at the mercy of rent-seeking intermediaries. One broker told me that he buys ‘conflict gold’ from places such as the Central African Republic for around 40 per cent of its global value and then sells it to sanctioned Russians for much more than it’s worth.

Some gold circles back to the region. Before the purchasing premium was removed in February, some Emirati bullion was arriving in Ethiopia, where it was melted down and mixed with local gold before being sold to the national bank. It’s possible that this circular economy flattered foreign exchange reserves, lending credibility to Ethiopia’s ongoing IMF-imposed reforms. In Addis Ababa, a broker opened the boot of his car to show me gold bars stamped with the logos of two Emirati refineries. One is certified by a body that claims to advance responsible business practices at each stage of the jewellery supply chain. I asked him where it came from. ‘Dubai,’ he replied. ‘And before that?’ He shrugged. ‘From everywhere.’