Bank of Tanzania's gold purchases surge to 35 tonnes in two years

Dar es Salaam. The Bank of Tanzania (BoT) has accumulated 35 tonnes of gold from domestic producers in two years, far exceeding its initial target of purchasing six tonnes a year as the central bank steps up efforts to strengthen the country’s foreign exchange reserves.

The sharp increase marks a significant expansion of the central bank’s Domestic Gold Purchasing Programme, which was introduced to diversify the country’s reserves, reduce exposure to fluctuations in major foreign currencies and provide greater protection against external financial shocks.

The programme enables the BoT to purchase domestically produced gold using Tanzanian shillings, converting part of the country’s mineral wealth into an internationally recognised reserve asset while injecting liquidity into the local economy.

The achievement follows presidential directives to increase the strategic use of Tanzania’s natural resources to strengthen economic resilience and has required closer coordination among key government institutions.

The Ministry of Finance, Ministry of Minerals, Mining Commission, Office of the Controller and Auditor General (CAG), Office of the Treasury Registrar (OTR) and Tanzania Revenue Authority (TRA) have worked together to strengthen the administrative, legal and fiscal systems supporting domestic gold purchases.

The institutional coordination has enabled the BoT to handle substantially higher volumes of gold while improving compliance, verification and transaction processes across the supply chain.

The programme has also benefited from increased participation by mining companies, commercial gold producers and artisanal and small-scale miners, alongside local refineries that process gold to international quality standards.

The development comes as Tanzania seeks to retain more value from its gold sector and strengthen the contribution of mining to the wider economy.

Gold remains one of the country’s most important sources of foreign exchange, with production coming from large-scale mines as well as a substantial small-scale mining sector.

The central bank said cooperation with private-sector players and international stakeholders has also helped strengthen responsible sourcing practices and maintain the quality required for gold to serve as a reserve asset.

As the programme enters its third year, the BoT is preparing to improve the efficiency and scale of its operations through greater automation and expanded digital financial infrastructure.

The planned upgrades are expected to simplify transactions, shorten payment cycles and improve coordination along the gold supply chain.

The government is also seeking to expand Tanzania’s domestic gold-processing capacity, with efforts under way to secure international accreditation for local refineries.

In particular, accreditation by the London Bullion Market Association (LBMA) would enhance the international recognition of locally refined gold and potentially improve its eligibility for global reserve and bullion markets.

The next phase of the programme will also place greater emphasis on financial inclusion within the mining sector, particularly among small-scale miners.

The BoT and other government institutions are developing measures to bring more miners into the formal banking system, with particular attention to women and young entrepreneurs, potentially giving them greater access to formal payments, savings and other financial services.

The expansion of domestic gold purchases comes against a backdrop of heightened global economic and financial uncertainty, reinforcing the importance for Tanzania of building a more diversified and resilient reserve position.