Gold has historically served as a reliable store of value and a strategic anchor in central banking—and African nations are reaffirming its relevance in today’s volatile economic climate. As global markets reel from geopolitical tensions, inflationary pressures, and evolving monetary policies, Africa’s central banks increasingly turn to gold to secure economic resilience, enhance monetary sovereignty, and build investor confidence.
Gold’s Renewed Global Relevance
The global resurgence in gold accumulation has been driven by its threefold advantage: safety, liquidity, and long-term value retention. These attributes make gold especially attractive during times of economic turbulence. According to the World Gold Council (WGC), gold has become a preferred reserve asset, especially as central banks seek to diversify away from overexposure to traditional reserve currencies like the U.S. dollar or euro.
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In 2024 alone, global central bank gold holdings surged to 36,000 metric tons—approaching the historical peak of 38,000 tons recorded six decades ago. The European Central Bank reported that over 1,000 tonnes of gold were purchased by central banks globally in the past year, doubling the average annual purchase rate of the last decade.
A WGC survey further revealed that 66% of central banks increased gold reserves to diversify their portfolios, while 20% did so primarily to hedge against geopolitical and economic shocks—such as the ongoing fallout from the Russia-Ukraine war and increasing global trade realignments.
Africa’s Strategic Shift Towards Gold
African economies, long vulnerable to currency fluctuations and external financial shocks, are increasingly aligning with global gold accumulation trends. For countries grappling with inflation, foreign debt burdens, and currency devaluation, gold offers a stable counterbalance. It enhances credibility in international finance circles and provides a buffer during crises.
Algeria, Libya, and Egypt—all located in North Africa—lead the continent in gold reserves. As of Q1 2025, Algeria holds 173.56 tonnes, followed by Libya with 146.65 tonnes, and Egypt with 128 tonnes. Their historic preference for gold as a core reserve asset underscores a long-standing strategic approach to monetary policy that prioritises wealth preservation.
Meanwhile, Ghana, Africa’s top gold-producing nation, ranks highest among sub-Saharan countries with 31.01 tonnes in reserves. As a significant exporter of gold, Ghana’s central bank has actively accumulated bullion to increase foreign exchange resilience and reduce dependence on external currency reserves.
Other countries making notable, if smaller, efforts include:
• Mauritius: 12.42 tonnes
• Tunisia: 6.84 tonnes
• Kenya: 0.02 tonnes
While modest in scale, these holdings reflect a conscious pivot toward diversification and stability, particularly for smaller economies with fewer export-driven income streams.
Gold as a Tool for Monetary Sovereignty
For nations like South Sudan, Zimbabwe, and Nigeria, increasing gold reserves is part of a broader agenda to reclaim monetary control and reduce reliance on volatile fiat currencies. These countries often face currency depreciation, capital flight, and declining investor confidence. By building up gold reserves, their central banks aim to backstop local currencies and improve the credibility of monetary policy.
In Zimbabwe, where the local currency has seen extreme devaluation, authorities have issued gold-backed digital tokens—a move aimed at restoring public trust and providing a hedge against inflation. In Nigeria, increased focus on gold reserves supports broader efforts to diversify reserves traditionally skewed toward oil and foreign currencies.
These policies are not without challenges. Many African countries still grapple with infrastructural limitations, political instability, and constrained fiscal capacity. However, the renewed emphasis on gold represents a calculated strategy to enhance long-term financial stability and sovereign monetary control.
Why Gold Matters Now More Than Ever
The price of gold reached historic highs in April 2025, peaking above $3,500 per ounce, as investors sought refuge amid escalating global economic uncertainty and political tensions. This record valuation further reinforces gold’s status as a trusted safe-haven asset.
For African central banks, these developments present both an opportunity and an imperative. As global central banks diversify reserves and reevaluate their strategic assets, African countries are doing the same—with gold emerging as a crucial piece of the puzzle.
Looking Ahead: Sustained Growth or Strategic Reassessment?
The momentum behind gold acquisition in Africa appears poised to continue. The WGC notes that over 20 central banks globally plan to increase their gold holdings in the coming year, and African nations are likely to remain part of this cohort.
However, for this strategy to yield its full benefits, African governments must complement gold accumulation with sound fiscal management, transparency in reserve disclosures, and policy stability. Effective use of gold reserves—whether to support local currencies, anchor sovereign wealth funds, or hedge against global shocks—will depend not just on acquisition but on integration into comprehensive economic planning.
Gold is no longer a relic of the past—it is a dynamic, strategic tool at the heart of modern monetary policy. For African central banks, increasing gold reserves is more than a financial tactic; it is a declaration of intent to protect national economies from external vulnerabilities, project monetary credibility, and assert financial independence. In a world where uncertainty is the only constant, Africa’s gold strategy is a golden hedge for its future.
