Dar es Salaam. While ongoing geopolitical tensions continue to rattle the global economy, they are proving to be a boon for gold-producing countries such as Tanzania, as the price of the precious metal has surged by an average of 88.12 percent over the past six years.
At the centre of this trend is the global shift towards safe-haven assets, with investors and governments increasingly turning to gold amid concerns over the stability of the US Dollar.
Tanzania, one of Africa’s top gold producers, is reaping the benefits.
Official data shows that the country’s foreign exchange earnings from gold more than doubled, rising from $1.549 billion in 2018 to $3.369 billion in 2024.
The increase is largely attributed to both a rise in production volumes and a significant uptick in gold prices.
In 2018, the annual average price per troy ounce of gold stood at $1,269.23. By 2024, that figure had climbed to $2,387.70.
Although a number of factors have contributed to this rise, analysts point to a series of global events as key drivers—ranging from the Covid-19 pandemic and the Russia-Ukraine conflict to the Western sanctions on Moscow and recent escalations in Gaza, alongside trade tensions sparked by the US.
Independent financial analyst, Oscar Mkude, said the global demand for gold is deeply tied to economic uncertainties.
“People around the world are feeling uncertain about the future. They are worried about their money losing value and their wealth being at risk. As a result, many are turning to gold as a safer way to protect their savings,” he said.
For Tanzania, he noted, the situation presents a strategic opportunity.
“Tanzania is a gold-exporting country, and as global demand for gold increases, the country could benefit. However, the global gold market is vast and saturated. Buyers remain hesitant on the timing and quantity of their purchases due to market unpredictability. While this may cause short-term delays for Tanzania, it remains a valuable window of opportunity,” Mr Mkude said.
He further explained that gold’s reputation as a reliable store of value strengthens during times of inflation and market volatility.
“More people are holding onto gold instead of selling it, which ironically makes it harder for sellers to find buyers in the short term,” he said.
University of Dar es Salaam senior finance lecturer, Dr Tobias Swai, told The Citizen that the Bank of Tanzania’s (BoT) decision to begin purchasing gold is starting to yield positive outcomes.
He said that if the central bank also ventures into gold trading, it could provide an even greater boost for the country’s economy.
“This move could raise the value of gold in the international market, in turn increasing Tanzania’s foreign currency reserves. With more reserves, the country would be better equipped to pay for imports and protect its economy from external shocks,” he noted.
Dr Swai said that sustained commitment to this strategy—both in buying and trading gold—could significantly enhance the country’s financial resilience and stability.
In line with Section 59 of the Mining Act (Cap 123), BoT is mandated to buying 20 percent of gold produced by small scale miners in Tanzania.
BoT announced in February, this year that it has acquired two tonnes of gold for its reserves since July 2024.
Its target is to buy six tonnes of gold this financial year.
