Gold has always carried a certain weight in Ethiopia, not just in its literal form but in its long history of allure, survival, and economic significance. In recent years, that story has entered a new phase, shaped by soaring global prices and a domestic sector struggling to keep pace with the pressures and possibilities of a transforming international market.
As gold climbed to historic highs in 2025, its glow reached deep into Ethiopia’s highland valleys, riverbeds, market towns, and regional bureaus. The result was a picture of both promise and unease, a mix of accelerating incentives and stubborn structural obstacles. The world was buying more gold than it had in decades, and Ethiopia found itself suspended between extraordinary opportunity and persistent fragilities.
The global rally has been one of the most dramatic in recent times. An October report from the World Bank reveals that international demand for gold grew roughly ten percent in the first three quarters of 2025. Prices increased by about forty-two percent over the same period, marking the strongest annual performance since the late 1970s.
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Much of this rise was driven by the unusually aggressive accumulation of gold by central banks. Reports indicate their total net purchases were more than double the pre-pandemic yearly average between 2015 and 2019. Investors retreated from volatile capital markets into gold as geopolitical tensions, fiscal uncertainty, and currency risks mounted. A weakening United States dollar supported higher prices, while looser monetary conditions strengthened demand.
At one point in October, gold briefly exceeded USD 4,300 per ounce. The World Bank projected that precious-metal prices would remain historically high in 2026, with further upside risks tied to geopolitical instability and financial-market pressures.
These global forces shaped the conditions for a thriving gold trade in Ethiopia. From May to mid-November 2025, the National Bank of Ethiopia (NBE) raised its 24-karat gold buying rate from close to USD 106 per gram to more than USD 131.
In Birr terms, the increase was even sharper, rising from 14,200 Birr to nearly 20,300.
The steepest single-month rise occurred between August and September, when dollar prices climbed more than twelve percent. Ethiopia’s domestic price adjustments reflected not only global pressures but also local currency depreciation.
Ethiopia’s relationship with gold is far older than the current rally. The Ministry of Mines’ Investor Guide identifies Ethiopia as one of the region’s most promising gold jurisdictions, containing more than 200 metric tons of identified reserves across three major greenstone belts.
The northern belt in Tigray includes Terakimti, Adi Zeresenay, Meli, and Daro. The western belt stretches across Benishangul-Gumuz and parts of Gambella. The southern belt, especially around the Adola district, includes Lega Dembi, Sakaro, and Tulu Kapi. Geological mapping expanded significantly after the late 1960s, yet Ethiopia’s formal gold production remains far below its geological potential.
Artisanal and small-scale mining continues to dominate output. More than one million Ethiopians participate directly in traditional gold mining, and several million more depend on related activities. Weak infrastructure, long distances to buying centers, and fragmentation between federal and regional authorities have historically pushed miners toward informal buyers rather than formal submission to the National Bank.
Those structural issues remain in place today, and differences across regions reveal how unevenly the recent rally has been felt.
In Benishangul-Gumuz, the changes have been immediate and measurable. The head of the regional mining bureau, Tujane Adem, described a dramatic rise in gold submissions in recent years.
“Our region delivered 1,725 kilograms of gold to the central bank in the first quarter. Compared to last year, this represents a 200 percent increase,” he told The Reporter Magazine.
He explained that the increase was tied largely to the NBE’s 15 percent top-up incentive for five kilograms or more of gold submitted through formal channels. Previously, miners preferred the shadow market, where prices were often higher and transactions faster. Now, with the formal bonus, the advantage has shifted.
Tujane observes the policy has motivated miners to form cooperatives so they can increase their earnings. More than 5,000 artisanal miners are licensed in the region, and many have begun to form cooperative associations in a bid to pool their gold and qualify for the central bank’s incentive.
Miners in Benishangul the region sold 482 kilos of gold to the central bank in October, exceeding expectations for what is typically a slow season, coming just after the rainy period.
Tujane was explicit about the composition and licensing status of mining in his region. He said that all the gold he referenced came from small-scale artisanal miners and that no large-scale operator had sold gold to the central bank.
He added that while four large-scale licenses exist in the region, only two are currently conducting exploration and none have commenced full mining operations.
Tujane also explained how regional revenue interacts with federal structures.
“Producers pay royalty fees to the region, which go to the regional government. Licensed miners pay taxes according to their production levels. Large-scale miners licensed by the federal government pay taxes to the federal government,” he said.
Tujane said that while illicit trade has declined, it still accounts for about fifteen percent of activity. Given how easily gold can be transported, full control remains elusive.
“Gold is hard to control because even small amounts can be easily transported in pockets,” Tujane noted.
Recent fiscal-year figures from the region highlight the volatility of gold production and its reported value.
However, the region’s mining officials have high expectations for the current year. They foresee the sale of more than 8,100 kilos of gold, valued at an estimated 202.7 billion Birr.
Export Volatility Amid Global Price Surge
Nationally, the gold export trade of the past decade has been marked by volatility. Ethiopia’s exports have fluctuated sharply, reflecting shifts in both global prices and domestic production.
Export volumes peaked at 9.56 metric tons in 2020/21 before collapsing in 2022/23, falling by more than 60 percent. Export earnings mirrored this trend, dropping from USD 546.4 million in 2021/22 to just USD 197 million the following year.
The recovery in 2023/24 was driven by rising international prices and a sharp increase in unit value to USD 96.91 per gram.
Last year, the sector recorded an unprecedented surge, with export volumes reaching 37 metric tons and earnings soaring to USD 3.5 billion, a staggering 756.8 percent increase over the previous year.
This exceptional surge stands apart. A recent IMF staff report indicates that it was driven not by increased production but by the release of inventories and the reopening of trade routes. The IMF projects that export volumes would moderate in 2025/2026, yet remain above historical levels.
The report notes that strong world prices had improved Ethiopia’s terms of trade and that the NBE had begun returning some of the foreign exchange accumulated from gold sales back into commercial banks through competitive auctions once reserves exceeded internal targets.
While Benishangul-Gumuz is expanding production, Tigray faces a different reality. The region’s mining officials suspended all mining operations in February following the formation of a regional task force assigned to investigate reports of widespread illegal mining networks and rebuild administrative systems.
Despite the halt, the NBE received 320 kilos of gold from Tigray between July and November 2025.
“We do not fully know the origin of this gold,” Birkti Gebremedhin, head of the regional Mining Bureau, told The Reporter Magazine.
She explained that licensed middlemen continue purchasing from artisanal miners, and said it is difficult to verify sources given the current institutional vacuum in the region. Birkti added that illegal mining is extremely difficult to control because regional security structures have yet to recover from conflict.
Uncertainty around Tigray’s gold supply has intensified. Independent reports have revealed time and again that former soldiers, foreign financiers, and government officials particularly from the region have been deeply involved in the illegal gold mining in Tigray. The reports also note that the central bank purchased more than 18,000 kilograms of gold from Tigray last year, far beyond projected legal output.
The ambiguity of where Tigray’s gold is coming from would be troubling in any period. But the backdrop is even darker. The voices in this piece are clear about the stakes. Tujane in Benishangul-Gumuz described reform-driven gains and cautioned that more training and better reporting are necessary.
Birkti described a halt to legal mining and the uncertainty of how gold is still moving into the market from her region. Those accounts, together with central bank statistics and international analyses by the World Bank and the IMF, show a sector at a crossroads. The balance Ethiopia strikes in the coming months, between capturing revenue and enforcing control, will determine whether this season of high prices becomes the foundation for sustainable growth or another episode of short-term gain and long-term costs.
