Tanzania Sells Gold Reserves to Defy Global Aid Cuts
Tanzania Liquidates Gold Reserves to Defy Global Aid Cuts
According to Bloomberg, the decision was disclosed by Minister of State in the President’s Office Kitila Mkumbo during a briefing in London on Monday, following instructions from President Samia Suluhu Hassan to the central bank to proceed with a partial sale of its gold holdings, according to Bloomberg News. The Bank of Tanzania held 3.3 trillion shillings, or about $1.3 billion, in bullion at the end of December, based on data published last week.
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This shift reflects a broader trend among gold-producing nations, especially in Africa, Latin America, and Asia. Central banks in Ghana, Tanzania, Zambia, Colombia, Mongolia, and the Philippines are already engaging in such purchases. Ghana’s Gold Board secured agreements with local miners to acquire 20% of output, while Tanzania mandated a similar minimum sale quota to its central bank in 2023. “You’re able to grow your reserves using local currency and therefore not sacrifice another reserve asset [like the U.S. dollar],” said Shaokai Fan, Head of Central Banks at the WGC. Read full story
“Governments are no longer interested in providing aid to Africa so we are reorganizing ourselves,” Mkumbo said.
Tanzania has been accumulating gold domestically since 2023 through purchases from local miners, positioning bullion as a reserve diversification tool. The planned sale comes as gold prices trade at record highs, offering a window to monetize reserves for fiscal support.
Across Africa, budget planning has become more uncertain as the US and European governments scale back development aid in favor of domestic priorities such as defense spending. The dismantling of the US Agency for International Development last year under the Trump administration contributed to a 17% decline in global foreign aid, according to OECD estimates.
Tanzania has also faced political headwinds with European partners. Following a disputed election that triggered protests and a violent security response, the European Parliament in November adopted a non-binding resolution calling for the suspension of a €156 million support program to the country.
