Gold boom boosts exports amidst mounting calls for diversification

Gold generated export earnings of $5.5 billion in the year ending May 2026, strengthening its position as Tanzania's leading export commodity.

The strong performance reflects a combination of higher international prices and increased domestic production, reinforcing mining's growing contribution to the national economy.

Indicative prices published by the Tanzania Mining Commission reached $4,161.89 per troy ounce on July 7, 2026 buoyed by sustained global demand and investors' continued preference for gold amid economic and geopolitical uncertainty.

Data from the Bank of Tanzania (BoT) show that the value of mineral recovery rose by 44.7 percent to $1.61 billion during the quarter ending March 2026.

The increase was largely driven by higher international gold prices, which significantly boosted the value of mineral production.

Gold alone generated $1.44 billion, accounting for 89.2 percent of total mineral recovery during the period.

According to the BoT's Consolidated Zonal Economic Performance Report, investors continued to flock to gold as a safe-haven asset amid geopolitical tensions and uncertainty surrounding global trade policies.

The report shows that the average international gold price rose by 70.3 percent compared with the corresponding quarter a year earlier.

Industry leaders argue that the current boom should be viewed as an opportunity to broaden Tanzania's mineral base rather than deepen its dependence on gold.

Tanzania Chamber of Mines Executive Secretary Benjamin Mchwampaka said favourable international prices had encouraged mining companies to expand production and maximise output.

Despite gold's remarkable performance, BoT data reveal how heavily the mining sector relies on a single commodity.

Coal accounted for 5.2 percent of total mineral recovery, although its contribution declined because of weaker demand from European markets.

Graphite contributed 0.7 percent, nickel 0.3 percent, while diamonds, gemstones and tanzanite each accounted for less than one percent.

Mr Mchwampaka said the country's long-term mining prospects depend on bringing strategic mineral projects into commercial production.

Tanzania possesses substantial deposits of graphite, nickel, rare earth elements and uranium, many of which have reached advanced stages of exploration and project development.

New gold projects, including the Nyanzaga mine, are also expected to commence production in the coming years.

"The entry of these projects will increase mineral output, strengthen export earnings and reduce reliance on a single commodity," Mr Mchwampaka said.

Mining activity also remains concentrated in a few regions.

The Lake Zone accounted for 67.6 percent of total mineral recovery during the quarter, reflecting the dominance of gold production in Geita and Shinyanga. The Southern Highlands contributed 13.5 percent.

In value terms, mineral recovery in the Lake Zone reached $1.09 billion, compared with $217.8 million in the Southern Highlands, underlining the uneven geographical distribution of mining activity.

Industry stakeholders also credit government reforms aimed at formalising mineral trading for improving the sector's overall performance.

Mr Mchwampaka said the establishment of official mineral markets has encouraged miners, particularly artisanal and small-scale producers, to sell through formal channels.

"The availability of local mineral markets has simplified the process of selling gold within the formal system.

This has encouraged more miners to trade legally... and enabled the government to collect more revenue," he said.

Nevertheless, experts argue that Tanzania must move more quickly to convert mineral discoveries into operating mines if it is to unlock the full economic potential of its vast mineral resources.

Mining procurement and supply chain specialist Humphrey Simba said several commercially viable projects remain delayed at the exploration, licensing or development stages.

"The government should make deliberate efforts to fast-track delayed mining projects so they can move into commercial production.

The country is missing significant opportunities because several viable projects have yet to reach the production phase," he said.

According to Mr Simba, expanding the number of producing mines would generate benefits extending well beyond export earnings.

"Every project that reaches production creates opportunities for local suppliers, transporters, contractors and surrounding communities...," he said.

The industry has also welcomed recent policy reforms designed to strengthen investor confidence.

Mr Mchwampaka said amendments introduced through the Finance Act 2026/27 addressed long-standing inconsistencies between Framework Agreements signed with investors and the country's tax regime.

The previous uncertainty had complicated financing arrangements for mining projects and delayed investment decisions.

"The new Finance Act has addressed this gap, giving investors greater confidence to mobilise capital and move projects into production," he said.

As demand for minerals used in renewable energy technologies continues to rise worldwide, experts believe Tanzania is well positioned to benefit from growing markets for graphite, nickel, rare earth elements and uranium.

However, they caution that the opportunity will depend on how quickly projects move from exploration to commercial production.

 "Within the next two to three years, we expect to see tangible results as more mining projects begin production and contribute to export earnings, government revenue and employment," Mr Mchwampaka said.

Although gold remains the cornerstone of Tanzania's mining industry, analysts say sustaining long-term growth will require building a more diversified mineral economy that is less vulnerable to fluctuations in global gold prices while capitalising on the increasing demand for strategic minerals essential to the global energy transition.