Uganda’s central bank is set to begin a domestic gold purchasing programme this month, aiming to bolster its foreign reserves and shield the economy from global financial risks, officials said Monday.
The initiative, announced two years ago, comes amid rising international gold prices and increased interest among central banks worldwide in diversifying reserves with bullion. “If all goes as planned, we should be able to purchase at least 100 kilograms of gold between March and June 2026,” said Adam Mugume gold annually.
The country established its first bullion processor, Africa Gold Refinery, in 2017, and several additional refineries have since been built, processing both domestic production and gold shipments from the neighbouring Democratic Republic of Congo.
The launch of the central bank programme coincides with heightened global demand for gold, driven by geopolitical and economic uncertainty. Spot gold jumped more than 2 percent on March 2 to US$5,395.99 an ounce, following international concerns about U.S.-Israel strikes on Iran.
Analysts say that central banks view gold as a hedge against currency volatility, inflationary pressures, and financial market instability. Mugume did not indicate whether the recent price spike would alter the planned purchases.
Other East African nations are following similar strategies. Kenya and the Democratic Republic of Congo have also announced programmes to acquire gold for their central bank reserves, reflecting a regional trend of diversifying national assets with bullion.
Economists say the Uganda programme could provide additional benefits beyond reserve accumulation. By offering a guaranteed buyer, the central bank may stabilise domestic gold prices, encourage formalisation in the artisanal mining sector, and reduce smuggling. “This initiative not only strengthens the country’s reserves but also incentivises compliance and improves reporting standards in the gold industry,” said a Kampala-based mining analyst.
Officials also emphasise that the programme supports broader economic objectives, including value addition and long-term sector development. By refining and processing gold domestically, Uganda can capture a greater share of revenue from its mineral wealth while reducing exposure to price swings on international commodity markets.
The Bank of Uganda’s gold purchasing programme is expected to operate from March through June 2026, with purchases structured to include artisanal miners, medium-scale operators, and industrial producers. Authorities say the initiative is part of a broader effort to formalise and develop the sector, expand refining capacity, and promote sustainable mining practices.
As global gold prices remain high and domestic production grows, Uganda’s central bank programme represents a strategic step toward enhancing financial resilience, securing foreign reserves, and supporting a sector that has become increasingly vital to national revenue and economic stability. The programme is likely to be closely watched by investors, policymakers, and regional partners alike.
