Sudan’s Conflict Economy: How Gold and Gum Arabic Are Funding the Fighting and What Institutions Can Do

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Gold and gum arabic have become a financial lifeline for actors in Sudan’s conflict. This analysis outlines how those commodity flows have drawn public and regulatory scrutiny, identifies the main institutional players, and explains the governance gaps that keep the war economy running. In short: armed factions, local intermediaries and networks moving commodities and cash continue to fund military operations. Those disclosures prompted media attention, UN engagement and calls from regulators and civil society for stronger monitoring, because the trade undermines regional stability and humanitarian protection.

Background and timeline

Fighting between rival military factions from early 2023 disrupted state revenue and formal trade channels. As government control weakened in many areas, informal commodity markets grew. Over the following months and years, international reporting and UN briefings documented two parallel revenue streams gaining prominence: artisanal and semi-industrial gold production, and exports of gum arabic, a tree-derived stabiliser used in food, soft drinks, cosmetics and medicines. Investigations and sanctions-related reporting tracked bulk movements of gold and consignments of gum arabic from production zones to domestic traders and on to regional and international buyers. Those commodity flows coincided with reduced customs oversight, fractured banking relationships, and the rise of alternative payment and logistics networks. The result has been sustained financing for armed actors and a growing policy debate about supply-chain integrity.

What Is Established

• Gold production and trade are significant sources of revenue in parts of Sudan; some exports have continued despite the conflict.
• Gum arabic is an internationally traded agricultural commodity with known end-uses in food, beverages and personal care products.
• International agencies, including UN offices, have reported links between commodity flows and funding streams for armed actors, prompting monitoring and reporting efforts.
• Weakened state institutions, disrupted customs and diminished banking access have increased the role of informal intermediaries in cross-border trade.

What Remains Contested

• The precise financial scale of revenues channelled from gold and gum arabic to specific armed groups is still being verified and varies across reports.
• The extent to which particular external buyers or companies knowingly purchased conflicted consignments remains under investigation.
• Legal and practical accountability for actors along long supply chains is unresolved until formal investigations or prosecutions conclude.
• The effectiveness of sanctions, export controls and due diligence frameworks in stopping illicit flows is debated among policymakers and industry stakeholders.

Sequence of events (factual narrative)

• Conflict reduced central government revenue collection and constrained formal export channels.
• Local mining and gum arabic production continued; traders adapted by using informal routes and alternative payment mechanisms.
• International monitoring bodies reported these commodity flows as sustaining operational costs for armed actors, prompting media coverage and diplomatic concern.
• Regulators and industry groups responded with calls for enhanced due diligence, while humanitarian agencies warned of increased civilian harm linked to sustained conflict financing.

Stakeholder positions

Government and state-aligned actors stress the need to restore formal institutions to regain control over revenue. International organisations and UN offices emphasise transparency, sanctions compliance and targeted monitoring of high-risk commodity sectors. Trade associations and private-sector actors point to supply-chain complexity and ask for clearer guidance and support to implement due diligence, rather than blanket trade restrictions that could harm legitimate producers. Civil society groups focus on human rights and press buyers and banks to adopt stronger screening to avoid inadvertently bankrolling violence.

Regional context

Sudan’s commodity markets are tied into a wider Horn of Africa and Sahel trade environment where porous borders, informal financial systems and weak regulatory capacity create vulnerabilities. Regional demand for gold and agricultural inputs, combined with limited cross-border oversight, makes interdiction difficult. Neighbouring states face spillover risks-refugee flows, illicit financial movements and criminal networks-which has encouraged both cooperative security measures and competing policy stances depending on national priorities.

Institutional and Governance Dynamics

The core governance problem is systemic: when fiscal and regulatory capacities weaken, private and informal networks expand to fill commercial and financial gaps. That creates perverse incentives for local power brokers and intermediaries who profit from regulatory opacity. International frameworks-sanctions, trade due diligence standards and anti-money-laundering rules-can help, but they rely on functioning institutions, cross-border cooperation and commercial compliance. Where customs, banking and judicial systems are impaired, incentives favour short-term rent extraction over long-term institutional reform. Addressing the issue therefore requires strengthening oversight, aligning commercial incentives with compliance, and creating pathways that protect legitimate producers while closing channels used to bankroll violence.

Policy options and forward-looking analysis

Policy responses fall into three complementary strands: immediate risk mitigation, medium-term institutional rebuild, and market-based incentives for compliance.

• Immediate: targeted monitoring of high-risk commodity shipments, coordinated regional customs checks, and enhanced financial intelligence sharing to trace proceeds from commodity sales.
• Medium-term: rebuilding customs capacity, restoring transparent licensing and certification schemes for producers and exporters, and reforming revenue management to reduce capture by non-state actors.
• Market-based: supporting traceability schemes for gum arabic and artisanal gold that certify legitimate origin, and giving buyers credible verification mechanisms to avoid disrupting the livelihoods of lawful smallholders.

Each option faces political and operational constraints. Implementing traceability and certification requires investment and trusted institutions; stronger financial controls depend on banks' willingness to re-engage with verified counterparties; and regional cooperation needs diplomatic capital. A blended approach, pairing safeguards for legitimate economic activity with targeted enforcement against illicit networks, will likely be most effective.

Implications for actors and reform priorities

For donors and international agencies: provide direct support for customs reform, technical assistance for traceability, and funding for investigative capacities. For regional regulators: adopt harmonised reporting standards and joint interdiction mechanisms. For private sector buyers: implement credible due diligence, run supplier support programs, and make transparency commitments. For civil society: continue monitoring and advocacy to ensure reforms respect rights and protect small producers.

Conclusion

Sudan’s situation shows how commodity markets can keep funding conflict when institutional oversight collapses. The task is not just to single out individuals, but to realign incentives across institutions, markets and regional partners so legitimate trade can continue without enabling armed financing. The coming months will test whether coordinated governance responses can reduce the conflict economy's capacity to sustain itself.

This article sits at the intersection of conflict economics and institutional governance in Africa: where state capacity weakens, commodity markets and informal finance can sustain violence, challenge regional stability and endanger humanitarian protection. Tackling these dynamics requires both technical reforms-customs, banking, traceability-and the political commitment to rebuild transparent institutions that align commercial practices with peace and accountability.

bankrolling · alongside · commodity governance · supply chain transparency · regional stability