The Central Bank of Egypt and African Export-Import Bank signed a memorandum of understanding (MoU) for the establishment of a pan African Gold Bank, which aims to formalise gold value chains, strengthen central bank reserves, and reduce reliance on foreign refining and trading hubs.
Establishing the Gold Bank program is in line with Egypt’s vision to expand strategic partnerships and strengthen mutual collaboration with African states across diverse fields, as well as African Export-Import Bank’s focus on promoting and accelerating value addition and strategic mineral processing.
Under the MoU, both institutions will collaborate on commissioning a Feasibility Study to assess the technical, commercial, and regulatory requirements for developing an integrating Gold Bank ecosystem in a designated free zone in Egypt, with the participation of African countries.
This includes establishing an internationally accredited refinery, secure vaulting facilities, and associated financial and trading services.
The Central Bank of Egypt notes that the initiative also targets the expansion of its scope across the continent, engaging governments, central banks, mining companies, and industry stakeholders to strengthen institutional collaboration and facilitate the sustainable trade of gold and related services.
African Export-Import Bank President George Elombi says this collaboration is considered a bold declaration that Africa’s gold must serve African people.
“This MoU, which is part of Afreximbank’s vision to make Africa’s resources benefit Africans, creates an African Gold Bank that will help us to begin to fundamentally alter the way we extract, refine, manage, value, store, and trade our gold resources, with the primary aim of retaining value on the continent,” Elombi says.
“By effectively building up the gold stock, as other major economies have done, we enhance the continent’s resilience, minimise vulnerability to external shocks, improve currency stability and convertibility, and create wealth within the continent.”
African Export-Import Bank is a Pan-African multilateral financial institution mandated to finance and promote intra and extra-African trade.
More than 1,000 tonnes of gold has been produced in Africa, with Ghana ranked as the continent’s top producer and sixth globally with 140.6 tonnes of gold, as reported by the World Gold Council.
The second top producer of Africa is Mali, accounting for 100 tonnes, followed by South Africa with 98.9 tonnes and Burkina Faso with 94.4 tonnes.
According to Swissaid, reports reveal that between 321 and 474 tonnes of gold is produced in Africa annually without being declared. In 2022, at least 435 tonnes of gold was smuggled out of the continent.
Swissaid says the lack of state control and the corruption that plagues the gold sector contribute to a high risk of human rights violations and environmental damage, from which local populations suffer.
Write to Aaliyah Rogan at Mining.com.au
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