The Central Bank of Tanzania will purchase 20% of all the gold directed for exports as the country prepares to diversify its reserves. The movement is seen as a reaction to the current acceleration of gold prices, with Tanzania aiming to amass at least 6 tones of gold this financial year.
Central Bank of Tanzania to Hoard 20% of Total Gold Exports
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Mining Regulator in Tanzania Enacts Directive to Retain 20% of the Gold Exports in the Country
Tanzania is set to increase its gold reserves as part of a move made by regulators to secure part of the gold produced in the country. A newly enacted law states that mining and trading firms will have to sell 20% of all the gold directed for exports to the Central Bank of Tanzania, which will seek to diversify and complement its reserves with this move.
The measure can be seen as a natural expansion of an already announced policy of buying gold from local miners using the national currency, the shilling. In 2023, Governor of the Bank of Tanzania Emmanuel Tutuba revealed that the bank had already purchased over 400 kilograms of gold, but sold it to increase its position in foreign currency.
The law, which will be in effect on October 1, indicates all the gold collected must be sent to two refineries: Eye of Africa Ltd and Mwanza Precious Metals Refinery Ltd. “All payments will be done according to the Bank of Tanzania arrangements,” the Tanzania Mining Commission stressed, without giving more details on the rates and prices miners will be paid. The goal is to purchase 6 tons of gold by this financial year.
Tanzania has been struggling with a lack of U.S. dollars and established restrictions on forex dealers to “foster macroeconomic stability and safeguard the stability of the financial system.” More recently, tourism authorities convened that all tourism fees must be paid in the local currency, incentivizing foreign tourists to exchange their dollars for shillings to support the country’s economy.
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