A Kenyan lawyer has urged the Central Bank of Kenya to pause negotiations with the Bank of England over storing the country's gold reserves in the UK. The demands highlight concerns about sovereignty, geopolitical risks, and transparency in the deal. This comes amid CBK's plans to diversify its foreign reserves by acquiring gold.
Days after Central Bank of Kenya Governor Kamau Thugge announced talks with the Bank of England about storing Kenya's gold, lawyer Abdulhakim Dahir issued an open letter demanding the immediate suspension of these discussions. Published on October 24, 2025, Dahir's letter raises alarms over transparency, costs, legal provisions, and risks to national sovereignty.
Dahir called for a national dialogue before proceeding and the urgent publication of deal details. He also demanded a public cost-benefit analysis weighing benefits against geopolitical and sovereignty risks. Additionally, he urged prioritizing a domestic gold reserve facility and full disclosure of the draft agreement to parliamentary committees and the public for scrutiny.
Thugge had revealed last week that Kenya is exploring gold purchases to diversify its $11 billion (Ksh1.4 trillion) foreign reserves, which primarily hold US dollars. "We’ve talked to the Bank of England and other banks to see how we go about it, where it will be stored, those kinds of things," Thugge said. He emphasized that the move is not to shift away from dollars but to broaden holdings, without specifying the amount to be converted to gold.
Dahir warned of vulnerabilities, stating, "Should Kenya ever find itself in a geopolitical dispute or subjected to international sanctions... our gold could be frozen or confiscated, leaving our economy vulnerable with little to no legal recourse." He further argued that storing gold in London would erode control over a key asset, creating dependency on UK laws or NATO directives during crises.
The push follows gold prices surpassing $4,200 (Ksh542,640) per ounce, driven by expectations of Federal Reserve rate cuts and global debt concerns. The Bank of England, founded in 1694, manages UK monetary policy and reserves.