· Tanzania, a country with rich gold deposits is reaping record foreign exchange earnings from the mineral
· The country’s foreign exchange earnings rose by close to $1 billion in just one year.
The international market price of gold is at a 9 year high. Covid-19 pandemic-related uncertainty made gold a popular alternative investment leading to an unprecedented rise in gold prices.
Tanzania, a country with rich gold deposits is reaping record foreign exchange earnings from the mineral. According to the latest report by the Bank of Tanzania (BoT), the country’s foreign exchange earnings rose by close to $1 billion in just one year. On a month-to-month basis, Tanzania’s earnings from gold exports stood at $266.8 million in July 2020 alone, compared to the $129.4 million that was earned in July 2019 recording a growth of 52.8 percent during the year to July 31, 2020. Tanzania earned $2.72 billion in the year that ended on July 31, 2020, from gold exports, up from the $1.78 billion earned compared to the same period in 2019.With the Post pandemic drop in tourism, Gold officially overtook tourism as Tanzania’s major foreign exchange earner in May, 2020.
At the global price for gold at $1,531.37 per troy ounce the country registered a total of $2.5 billion in gold exports during the year ending May, 2020. On a month-to-month basis, BoT says, gold prices at the world commodity market ,surged by 6.6 percent from $1,732.2 per troy ounce in June 2020, to $1,846.5 per troy ounce in July 2020.
Gold, along with horticultural products, pushed Tanzania’s earnings from non-traditional goods export higher to $4.86 billion in the year ending July 2020 from $3.68 billion in the corresponding period in 2019. BoT reported that earnings from traditional exports such as cotton, sisal, cashew nuts, coffee, tea, tobacco and cloves rose to $1 billion from $503.3 million in the corresponding period in 2019.
“The increase in the value of sisal export was on account of both volume and price in the world market. Improved export volume led to more earnings in the case of cashew nuts, cotton and cloves while export values for coffee and tea declined due to low export volume and prices in the world market.
Earnings from the service sector declined to $3.38 billion in the year ending July 2020 compared with $4.15 billion recorded in the year ending July 2019, driven by the drop in travel receipts because of suspension of international flights and lockdowns in major tourist source markets. Nevertheless, travel receipts accounted for 55.7 percent in service receipts.
