Lusaka – Zambia’s central bank has bought 289kg of gold, improving the country’s reserves to US$1.4 billion, or three month’s import cover.
This week, Bank of Zambia Governor Mr Christopher Mvunga told the media that the institution would continue to purchase gold monthly to cushion the country against the shocks caused by COVID-19.
The gold purchases are being done through the state-owned ZCCM IH and Kasenseli Gold Mining Limited as part of efforts to stabilise the kwacha.
”We are receiving various inquiries as to whether we are selling the gold or not but we have made it clear that we are not and we are principally buying the commodity as an international instrument and not trading,” Mr Mvunga said.
“We are foreseeing that at some point the exchange rate would stabilise and show some signs of recovery as there is a strong investor confidence in the economy making inquiries and others are already coming on the market.”
He said at the appropriate time, the Bank of Zambia would start selling gold.
Zambia is now one of at least 10 countries that have been net buyers of gold since 2020, among them Russia and China who collectively added 483 tonnes of bullion to their reserves.
The Bank of Canada has liquidated most of its reserves in recent times while Venezuela is in the process of doing the same to pay off its debts.