Good morning. An investigation by The Globe and Mail and The Bureau of Investigative Journalism has shone a light on Canadian-licensed gold mines in Ethiopia’s war-scarred Tigray region – and an illegal trade driving further instability. That’s in focus today.

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Northern Ethiopia’s Tigray region is still recovering from a civil war that killed hundreds of thousands. Once tightly regulated, its mineral-rich highlands are now the focus of a postwar gold rush. With gold prices cresting US$4,000 an ounce, miners and investors have poured in. Along roads once lined with checkpoints, heavy machinery now digs vast new quarries.

The stakes

Records from Ethiopia’s national bank show that gold worth billions of dollars has been mined in Tigray over the past year – far more than the region was projected to produce legally. Former soldiers and Chinese miners have operated under the protection of local military forces. Gold is funnelled through networks that risk fuelling renewed conflict across the Horn of Africa.

China’s state-backed mining firms have spent two decades expanding across Africa, securing access to gold and other critical minerals used in the electronics, battery and defence industries. Backed by state financing, these ventures give Beijing long-term leverage over strategic resources that underpin both industrial growth and military capacity, according to a report this year from AIDData, a foreign policy research organization.

The risks

The rogue gold economy has enriched armed groups and devastated local communities. Toxic chemicals are contaminating farmland and water sources, and analysts warn that Tigray’s gold boom could reignite conflict and destabilize Ethiopia’s fragile peace.

The gold trade is deepening Ethiopia’s economic fragmentation. Smuggling networks controlled by competing military factions are undermining federal authority and diverting millions from the country’s treasury.

The trade is also reshaping regional power dynamics. Analysts say foreign capital is entrenching economic influence in a volatile border zone that connects Ethiopia, Eritrea and Sudan, all areas with histories of resource-fuelled violence.

The companies

At the centre of The Globe story is East Africa Metals, a Vancouver-based company that holds industrial mining licences for two major projects, Mato Bula and Da Tambuk. EAM’s partner, Tibet Huayu Mining Co. of China, financed mine construction and promoted the projects to Chinese investors.

Though both firms’ public filings stated that the sites remained inactive, satellite imagery and witness accounts show extensive activity since early 2024. Miners, brokers and officials described a brisk underground gold trade in Tigray, with Chinese workers and local soldiers at mining sites.

EAM also has connections to Sinotech Minerals Exploration and Anchises Capital, both tied to Chinese geologist Dr. Jingbin Wang, who chairs EAM’s board and holds senior positions in China’s critical-minerals sector.

EAM’s response

The company denied having any role in illegal mining, smuggling or environmental harm. It maintains that any unauthorized activity is not large in scale and was carried out independently and that it has been unable to access its sites since the war. Tibet Huayu did not respond to requests for comment.

Read the full investigation here.