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FG boosts foreign reserves by $5m with first gold sale

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FG boosts foreign reserves by $5m with first gold sale

Minister of Solid Minerals Development, Dr. Dele Alake, has presented President Bola Ahmed Tinubu with a gold bar sourced from artisanal and small gold miners and refined by the Solid Minerals Development Fund to meet the London Bullion Market Association Good Delivery Standard.

Alake, during the event, praised President Tinubu for supporting reforms in the solid minerals sector, assuring that the National Gold Purchase Program (NGPP) would enhance the country’s reserves and boost the naira’s value.

Alake explained to President Tinubu that this event marked the first commercial transaction under the NGPP, a centralised offtake scheme supported by a decentralised network of artisanal and small-scale miners and cooperatives.

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“The successful completion of the first commercial transaction clearly demonstrates the National Gold Purchase Program’s effectiveness. It has increased the nation’s foreign reserves assets and shown that using the Nigerian Naira to purchase a liquid asset traded in United States dollars, such as gold, is a viable strategy.”

The initial transaction has resulted in a +US$5 million increase in Nigeria’s foreign reserves, the refinement of over 70 kilograms of gold to the London Bullion Market Good Delivery Standard, and the successful aggregation of locally mined gold, injecting approximately NGN6 billion into the rural economy.

Upon receiving and displaying a symbolic gold bar, President Tinubu, lauded the Alake’s ministry for achieving a significant milestone in the administration’s efforts to diversify the economy.

“This is another concrete step towards the diversification process under the Renewed Hope Agenda.”

The Executive Secretary of the Solid Minerals Development Fund, Fatimah Shinkafi, noted that the London Bullion Market Good Delivery Standard is a globally recognised and trusted benchmark enabling global trade in gold and silver bars.

“Only gold and silver bars that meet our Good Delivery standards are acceptable in the settlement of a Loco London contract – where the bullion traded is physically held in London”, she explained.

Shinkafi highlighted that through the NGPP, Nigeria has joined a select group of countries enhancing their gold reserves by purchasing gold in local currency.

This move is expected to foster economic confidence, enhance currency stability, and create a more attractive environment for foreign investment.

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