The first ever international gold exchange in Geita Region that will attract both local and foreign gold dealers is set to kick start before the end of the month, Geita Regional Commissioner Eng Robert Gabriel has said.
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 RC said yesterday that infrastructures needed for the commencement of the envisioned first East Africa gold trading hub, including a one stop centre, are in place.
“We have everything in place for the gold exchange to take off. We are currently waiting for the Ministry of Mining to give us confirmation of one of the high profile government officials to officiate the opening of the market,” he said, adding:
“The international gold bullion will boost the earnings of the small scale miners generated from gold mining activities as well as maximise government revenues that were otherwise go unnoticed,”
According to 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 withholding tax of 5 percent and 18 percent value added tax by small-scale miners in the nation.
He said brokers will be buying gold from the small scale miners in the eight official centres established in the region before bringing them to the gold market for trading with dealers.
Eng Gabriel said each district in the five districts of Geita Region will have one centre for the collection of gold from small scale miners.
He said already two banks, CRDB and Azania, were finalising the establishment of their branches inside the complex where gold trading will be taking place in order that buyers and sellers may carry safe and secure transactions.
“Since the gold market will attract huge volumes of business, banks will facilitate smooth transactions in the business,” he said.
Apart from maximising revenues for the government, he said also that the gold exchange will open up other business venues like hotels, in the region, increasing the use of the Chato and Mwanza airports.
The exchange will also curb gold smuggling to neighbouring countries as artisan miners will be fetching good prices at the exchange.
The Bank of Tanzania (BoT) Research Department Manager, Dr Nicas Yabu, said last week that when the gold exchange starts, it will boost the shilling stability against the greenback.
He said the international gold bullion will attract foreign traders who will bring dollars into the economy to boost the shilling stability.
“The gold exchange will help the country get correct statistics of gold exports and earnings generated,” he said, noting that, initially, the business will be conducted manually but with time it will be linked with BoT systems for monitoring.
Tanzania will join other African countries to have its own exchange. Others are Botswana with diamond exchange and South Africa; gold exchange.
Tanzania is ranked fourth in gold production in Africa after South Africa, Ghana and Mali. The key gold mining areas in the country are Geita, Mwanza, Shinyanga, Mbeya and Mara.
Geita accounts for almost 35 percent of Tanzania’s gold output. The RC said currently majority Tanzanians, “Don’t know where their gold is sold and the real value of the resources. The exchange will address that knowledge gap.”
Engineer Gabriel said the regional authorities have approached relevant establishments and is waiting to be told the next move to fast track the establishment of the exchange.