African central banks are increasing their gold reserves to safeguard against inflation and geopolitical instability. With gold, they can diversify their financial portfolio and protect their local currencies. In September 2023, gold was priced at $1,900 per ounce, rising to $2,500 a year later. According to the World Gold Council, demand for gold will likely continue rising despite the soaring prices. Countries like Ghana and Uganda are purchasing gold from artisanal miners to bolster foreign currency reserves, with Ghana planning to use gold for oil payments to ease currency pressures. Zimbabwe has also launched a gold-backed currency to curb inflation. Experts believe African countries are going for gold because it offers long-term value and helps them reduce reliance on the global financial system, particularly in the face of potential sanctions. However, some economists caution that gold alone cannot resolve broader economic issues.
SOURCE: VOA NEWS
