The Bank of Namibia has signed its first gold purchase agreement, accelerating a strategic shift to diversify its foreign exchange reserves and reduce exposure to global currency volatility.
The apex bank has entered into an agreement with QKR Namibia Navachab Gold Mine to acquire domestically produced gold, formally launching its gold accumulation programme.
The signing follows an announcement in August last year outlining the central bank’s intention to include gold in its reserves. However, Namibia does not yet have a refinery capable of producing gold at the required international standard, with local mines currently processing output to around 85% purity. The central bank has since initiated engagements with refineries in South Africa to ensure the gold is refined to 99.9% purity.
Under the strategy, the Bank aims to build gold holdings equivalent to around 3% of net foreign exchange reserves, aligning with global central banking practices where gold is used to hedge against inflation, currency risk and geopolitical shocks.
Governor Ebson Uanguta said the agreement marks a decisive step in strengthening the country’s reserve management framework.
“This agreement represents an important step in advancing the Bank’s reserve diversification strategy. Gold continues to play a critical role as a store of value and a hedge against global uncertainty,” he said.
The gold will be refined to 99.9% purity, stored in the central bank’s vaults and incorporated into Namibia’s official reserves.
The move signals a clear policy shift by the central bank to rebalance reserve assets, which have historically been concentrated in foreign currencies and liquid instruments. By introducing gold, the Bank is positioning itself to better absorb external shocks in an increasingly volatile global environment.
Uanguta said the initiative also allows Namibia to capture greater value from its mineral resources by retaining a portion of domestically produced gold within the economy.
“By partnering with domestic producers, we are not only strengthening our reserves but also supporting local value creation and economic development,” he said.
The acquisition programme will be implemented in phases, with purchases guided by market conditions, governance structures and risk management controls.
QKR Namibia Navachab Gold Mine managing director George Botshiwe said the agreement underscores the role of public-private collaboration in advancing national economic priorities.
“As Navachab Mine, we are proud to partner with the Bank of Namibia on this important initiative, which underscores the vital role that public-private partnerships play in advancing sustainable development,” he said.
The central bank said the programme will be executed with strict oversight to ensure transparency and accountability as it builds gold holdings over time.
The move comes amid a broader global trend of central banks increasing gold purchases to diversify reserves and reduce reliance on major currencies.
