Tanzania has made a bold step towards establishing the first-ever international gold exchange in East Africa at the gold-rich Geita region in the North Western part of its country.
The new development is in line with President John Magufuli’s latest directive to ensure that Tanzania takes a lead in the international gold business. The Geita Regional Commissioner, Eng Robert Gabriel stated that the infrastructure needed for the commencement of the envisioned first East African gold trading hub, including a one stop centre, were in place. He further stated that everything was in place for the gold exchange to take off, and they were waiting for the Ministry of Mining to give a confirmation of one of the high profile government officials to officiate the opening of the market.
The international gold bullion market is expected to boost the earnings of the small scale miners generated from gold mining activities as well as maximize government revenues. According to records from the Federation of Miners Association of Tanzania (FEMATA), there are more than six million small scale miners across Tanzania.
Last month the parliament endorsed a bill designed to remove payment of 5 percent withholding tax and 18 percent value added tax imposed on small scale miners. This was after the President organized a meeting with the mining stakeholders to find solutions to their grievances as well as receive advice on how best the mining sector can be operated for the better of the country and its people.
Each of the five districts in the Geita region will have one centre for the collection of gold from small scale miners, and two banks, Azania and CRDB are finalizing the establishment of their branches inside the complex where gold trading will be taking place in order for transactions to be conducted safely and secured.
Apart from boosting government revenue, the gold exchange will open up other business like hotels, and will also increase use of the Chato and Mwanza Airports. The hub will also serve to curb gold smuggling to neighboring countries since the artisanal miners will fetch good prices at the exchange. The Bank of Tanzania (BoT) is also skeptical the gold bullion will bring in foreign exchange which will boost the shilling stability against the dollar. On top of that, the exchange will enable the country to obtain correct statistics of gold exports and earnings, where initially the business was conducted manually.
Tanzania joins other African countries in having its own bullion market