Uganda’s central bank begins buying local gold to diversify foreign reserves and strengthen the economy. The pilot program targets 10 tonnes of gold annually.
Central Bank Launches Gold Purchase Initiative
The Bank of Uganda confirmed that it has started buying gold from local producers to build its foreign exchange reserves. This initiative follows a plan first announced two years ago to incorporate precious metals into the national treasury. Specifically, the bank made its first official purchase last Friday to kick off the new strategy. Because of this move, the country can now reduce its heavy reliance on traditional foreign currencies. Furthermore, the bank intends to run this effort as a three-year pilot program to test the market.
Strategic Shift Strengthens National Economic Reserves
This new program aims to build a more diverse portfolio by purchasing and processing gold mined within the country. According to official statements, the bank wants to strengthen reserve adequacy through these steady purchases. This means that the country will be better protected from the volatility of international financial markets. In addition, using local gold helps the government manage its wealth without depending solely on outside assets. Therefore, the central bank is joining a growing trend of African nations looking for safer ways to store value.
Local Mining Sector Set for Major Growth
Uganda has quickly become a major regional hub for gold processing and trading over the last few years. Recent data shows that the country exported $5.8 billion worth of gold in 2025 alone. This represents a massive 76 percent increase compared to the previous year. Despite this growth, small-scale miners still perform most of the mining work across the nation. Consequently, the government is working to bring these miners into the formal economy through this buying program.
Partnerships and Refining Support Local Industry
To ensure the gold meets international standards, the central bank has partnered with local firms like Euro Gold Refinery. This local refinery was launched in 2025 and is the first of its kind to be fully Ugandan-owned. By refining the metal at home, the country can keep more of the profits within its borders. Moreover, the bank plans to buy gold from licensed artisanal miners and large-scale producers alike. This approach ensures that the benefits of the program reach different levels of the mining industry.
“The program aims to build and diversify Uganda’s foreign exchange reserves portfolio by purchasing and processing domestically mined gold.” — Bank of Uganda, Official Statement
Conclusion
Ultimately, the Bank of Uganda is taking a bold step to secure the nation’s financial future through gold. This strategy will likely stabilize the economy and support the growing local mining sector. Shortly after this pilot phase, the government may expand the program to include even more producers. We expect the central bank to release more details on the total value of its holdings soon.
