Tanzania’s Central Bank Prepares To Launch Its Own CBDC

Tanzania’s central bank prepares to launch its own central bank digital currency after it started exploring this sector and the country is only following the steps of Nigeria that launched its own CBDC last month. Other African countries have similar plans to launch a CBDC as well so let’s read more in our latest altcoin news today.

Tanzania’s central bank started exploring central bank digital currencies according to a Bloomberg report showing that Governor Florens Luoga announced the plans at the 20^th Conference of Financial Institution- COFI. He said:

“To ensure that our country is not left behind the adoption of central bank digital currencies, the Bank of Tanzania has already begun preparations to have its own CBDC.”

The governor also said that the central bank is looking to expand research into digital currencies and to enhance the capacity of the team. Luoga said that this move is inspired by Nigeria’s launch of its own CBDC the eNaira and it partnered with German FinTech to launch a digital currency and a physical naira. The West Africa country is the second to have a CBDC after the Bahamas which launched its CBDC a year ago. The Governor also said that the central bank plans to diversify its foreign exchange reserves and to do that will buy gold from local refineries. The monetary gold that they aim to buy should have a purity of not less than 99.5%. he also expects teh country’s inflation rate to remain within the targeted range of 3% to 5% in 2021-22.

Luoga added that the central bank is cautious of cryptocurrencies and he reminded the public about the illegal status in the country saying that people should be wary of investing. Since 2019, Cryptocurrencies were banned in Tanzania after the central bank said they will not recognize them by law. However, this could change as the bank is working to reverse this ban. The development is a result of the Tanzanian President Samia Suluhu Hassan who asked the central bank to prepare for crypto after she became president.

More governments are starting to explore central bank digital currencies. Nigeria was the first African country to launch its CBDC so other countries are also researching opportunities that CBDCs provide for their economies. About two months ago, the Managing Director of the IMF Kristalina Georgieva said that more than 110 countries are at some stage of exploring CBDCs.