Staff Reporter

Zimbabwe has joined other African nations like South Sudan and Nigeria in increasing its gold reserves.

According to a recent World Gold Council survey, approximately 20 central banks are expected to enhance their gold holdings in the coming year.

This decision comes amid escalating geopolitical tensions and rising inflation that have severely impacted the region’s currencies. Following the lead of central banks in countries such as China and India, these African nations are diversifying their reserves to reduce reliance on the US dollar.

Economists have lauded Zimbabwe’s move, highlighting its potential benefits for the nation’s financial stability. In an interview with this publication, Persistence Gwanyanya, a well-known economist, emphasized the prudence of this strategy.

 “Increasing our gold reserves is a prudent move to stabilize the Zimbabwean dollar and curb inflation. Gold has historically been a reliable store of value, especially during times of economic uncertainty,” Gwanyanya remarked.

Raymond Gwata, another respected economist, echoed these sentiments saying that this move will enhance investor confidence and create a more stable economic environment.

“By increasing our gold reserves, we are sending a strong message to both domestic and international investors that Zimbabwe is committed to financial stability and economic growth.

The introduction of a gold-backed currency in Zimbabwe is expected to have several positive effects. It will likely lead to a stabilization of the local currency, reducing the extreme volatility that has characterized the Zimbabwean dollar in recent years,” Gwata added

Meanwhile, the move to increase gold reserves and introduce a gold-backed currency can enhance investor confidence. Investors are more likely to invest in a country that has a stable and predictable economic environment. By taking these steps, Zimbabwe is positioning itself as a more attractive destination for foreign investment, which is crucial for economic growth and development.

Furthermore, this strategy not only aligns with global trends but also addresses the specific economic challenges facing the country. By diversifying its reserves and reducing reliance on the US dollar, Zimbabwe is taking proactive measures to build a more resilient and robust economy.