Namibia has unveiled plans to adopt Ghana’s widely praised Gold Purchase Programme in a strategic bid to strengthen its monetary policy and revive its struggling economy.
The initiative seeks to boost the country’s foreign reserves, curb inflation, and reinforce the value of the Namibian dollar by stockpiling gold as a key financial asset.
With a robust mining sector and stable political environment, Namibia is one of Africa’s notable gold producers, and the industry remains a vital contributor to national GDP.
According to The Namibia Economist, Bank of Namibia (BoN) Governor Johannes !Gawaxab confirmed the move during a recent statutory meeting with President Dr. Netumbo Nandi-Ndaitwah.
The BoN reported that Namibia’s foreign reserves declined by 5.2% in the first quarter of 2025 to N$59.7 billion.
The central bank’s plan includes allocating up to 3% of net foreign exchange reserves to gold—mirroring a growing global trend as central banks turn to gold as a hedge against inflation and economic instability.
BoN data shows that gold earnings surged in the fourth quarter of 2024, climbing 20.1% year-on-year and 13.4% from the previous quarter, reaching N$4.3 billion.
Despite such positive trends, Namibia continues to grapple with structural economic challenges, including inflation, currency depreciation, and vulnerability to volatile commodity prices.
The adoption of Ghana’s gold reserve model forms part of a broader strategy to diversify the economy and reduce dependence on foreign currencies—especially the US dollar.
By increasing its gold holdings, the Bank of Namibia aims to improve the country’s foreign exchange position and build a more stable monetary foundation for future growth.
Ghana launched its Gold Purchase Programme in the early 2020s to mitigate the effects of global financial volatility and reduce reliance on the dollar.
Spearheaded by the Bank of Ghana, the programme allowed the central bank to purchase gold directly from domestic miners, integrating it into the country’s reserve portfolio.
While initially praised for its proactive approach, Ghana has since suspended the programme, raising questions about its long-term effectiveness in stabilizing foreign reserves and shielding developing economies from external shocks.
This reversal may offer a cautionary perspective for Namibia and other nations exploring similar strategies.
Critics warn that while gold can serve as a short-term hedge, it may not be a comprehensive solution for structural economic vulnerabilities—especially in countries with limited fiscal space.
Nevertheless, Namibia’s gold-focused strategy reflects a broader movement among African nations to seek homegrown, commodity-backed solutions to weather global economic uncertainty.
