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Tanzania: 20% of Gold Exports to Go to Central Bank for Reserve Diversification

© Sputnik . Ilya Naimushin / Go to the mediabankAn employee fills a container with granulated gold of the highest standard 99.99 at the Krasnoyarsk Non-Ferrous Metals Plant named after V.N. Gulidov.
An employee fills a container with granulated gold of the highest standard 99.99 at the Krasnoyarsk Non-Ferrous Metals Plant named after V.N. Gulidov. - Sputnik Africa, 1920, 28.09.2024
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Tanzania, a major gold producer in East Africa, relies heavily on its mining sector, which contributes about 4% to its GDP. Gold mining is an important source of employment and foreign exchange earnings for the country.
Tanzania's mining regulator mandated that all gold exporters allocate 20% of their gold to the central bank, aiming to diversify the bank's foreign reserves.
This move comes as the Bank of Tanzania (BoT) seeks to bolster its reserves and combat the depreciating shilling. The BoT purchased 418 kg of gold from local traders and miners last fiscal year and plans to purchase 6 tonnes in the current fiscal year.
In this Tuesday, July 22, 2014, file photo, gold bars are stacked in a vault at the United States Mint, in West Point, N.Y.  - Sputnik Africa, 1920, 22.08.2024
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The Tanzania's Mining Commission announced that a new mining law, effective October 1, mandates gold exporters to deliver 20% of their gold to two designated refineries: Eye of Africa Ltd in Dodoma and Mwanza Precious Metals Refinery Ltd in Mwanza.
"All payments will be done according to the Bank of Tanzania arrangements," the Tanzania's Mining Commission stated, not disclosing the specific rates for gold purchases.
Tanzania's foreign exchange reserves reached $5.29 billion in July, providing 4.3 months of import cover.
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