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The Bank of Tanzania (BoT) has clarified that it has no plans to sell its gold reserves to finance government strategic projects, stating that any ongoing sales are intended solely to rebalance its foreign reserves in line with Board-approved limits.
Speaking to the media in Dar es Salaam, BoT Director of Financial Markets Emmanuel Akaro said the central bank’s Board has set a cap on gold reserves at a value not exceeding US$2 billion.
However, current holdings have risen to about US$3.2 billion, prompting plans to sell the excess to restore the desired reserve structure.
He stressed that the move is guided by internal reserve management policy and is not linked to government budgetary financing.
“The gold being sold is only the amount exceeding the approved threshold, in accordance with the Board’s decision,” Akaro said.
He explained that proceeds from the sale will be reinvested in international financial markets to enhance BoT’s investment returns, not to support government development projects.
Any use of central bank investment funds for government purposes, he added, would require parliamentary approval.
Akaro noted that the decision is also driven by financial risk management. When BoT sells gold, it typically converts the proceeds into US dollars to maintain a balanced reserve portfolio and limit exposure to market volatility.
As of January 29, 2025, Tanzania’s foreign exchange reserves stood at approximately US$6.5 billion. Gold accounted for about US$1.2 billion of that total, while US dollar holdings were valued at US$3.5 billion and China’s yuan at around US$735 million.
He further revealed that BoT purchases gold on a daily basis, and over the past five months has acquired an average of nearly two tonnes per month equivalent to roughly 20 percent of the gold produced domestically and exported.
Beyond reserve management, Akaro said surplus foreign exchange is also used to meet the government’s external payment needs. In such cases, the government buys foreign currency directly from BoT using Tanzanian shillings rather than sourcing funds from commercial banks.
He added that BoT continues to inject foreign currency into the domestic market to improve access and stabilize the Tanzanian shilling.
In 2025, the central bank supplied about US$401 million to the market, a move credited with supporting the local currency’s performance.
The central bank reiterated its commitment to prudent reserve management, transparency, and safeguarding macroeconomic stability.