The Bank of Namibia (BoN) has announced a strategic pivot to include physical gold in its foreign exchange reserves, targeting gold to comprise 3% of its net reserves. The move, revealed in Governor Johannes !Gawaxab’s Monetary Policy Dialogue presentation yesterday, aims to bolster economic resilience amid global uncertainty and align with a broader trend among central banks diversifying away from traditional assets.
Gold accumulation forms a core pillar of the BoN’s enhanced reserves management strategy. The bank will acquire “London Bullion Market Association Good Delivery Bars” (99.9% purity) primarily from Namibian mines and store them domestically. This approach emphasizes national control and security while hedging against inflation and currency volatility. Governor !Gawaxab underscored gold’s role as a “strategic anchor” within reserves, reinforcing policy resilience and diversification during economic shocks.
The strategy reflects a global shift, with central banks increasingly repatriating gold and boosting holdings to enhance sovereign autonomy. The BoN noted gold’s unique attributes: a proven store of value, universal liquidity, and insulation from geopolitical risks. “Amid shifting monetary dynamics, central banks are turning to gold,” stated the presentation, highlighting its importance in safeguarding national wealth.
This initiative unfolds against a backdrop of economic headwinds for Namibia, including moderating GDP growth (projected at 3.5% in 2025), a widening current account deficit, and external risks like potential diamond export declines and spillovers from U.S. protectionist tariffs. By integrating gold, the BoN seeks to fortify Namibia’s financial buffers while supporting long-term monetary stability.
The Bank confirmed that gold reserves will be actively managed as part of its broader Foreign Exchange Reserves portfolio, with purchases phased in systematically. No timeline for reaching the 3% target was disclosed, but the move signals a proactive stance in navigating an increasingly volatile global economic landscape.