(Bloomberg) -- Tanzania plans to introduce its own digital money, following similar decisions in several emerging markets including Nigeria, which was the first to make the move in Africa.

Amid the fear of missing out, or FOMO, more governments have allowed the introduction of central bank digital currencies, or CBDCs, as national currency -- unlike their crypto counterparts, such as Bitcoin and Ethereum, which are not tied to fiat currency. 

“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,” central bank Governor Florens Luoga said Thursday at a finance conference in the capital, Dodoma.

Luoga likened Tanzania’s plans to follow the eNaira, which Nigeria introduced in October to cut transaction costs and boost participation in the formal financial system. The eNaira will complement the physical naira, which has weakened this year despite central bank’s efforts to stabilize it.

As part of preparations Tanzania is strengthening the capacity of central bank officials on digital currencies and expanding research, Luoga said. Tanzania remains wary on cryptocurrencies and continues to advise the public to be cautious, he said.

Tanzania’s central bank governor also said:

  • The central bank is also planning to buy gold from local refineries to diversify its foreign exchange reserves, Luoga said, without giving details. “The monetary gold that we plan to buy should have a purity of not less than 99.5%,” he said.
  • Inflation rate is expected to remain within the targeted range of 3% to 5% in 2021-22.
  • Economy may grow by 5% in 2021 and reach an annual average of 8% over the next five years, compared with 4.8% last year.

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