Chamwe Kiara
The Bank of Namibia (BoN) says it is close to finalising agreements under its gold accumulation strategy as it moves to diversify the country’s foreign exchange reserves.
Nicholas Mukasa, director of financial markets, said the central bank remains committed to the gold acquisition programme as part of efforts to strengthen economic stability amid global uncertainty.
“We are fairly advanced in concluding the agreements that will allow us to execute the accumulation of gold. We are close; we are very advanced with the gold acquisition programme,” Mukasa said.
He said the bank has engaged local mines and approved refineries from which it will purchase the gold. He added that gold plays a strategic role in times of crisis and will help diversify the reserve portfolio.
The strategy was launched last quarter as part of a broader effort to safeguard Namibia’s financial system and improve resilience against external shocks.
The central bank aims to allocate 3% of total net foreign exchange reserves to gold.
The gold will be acquired from local mines, stored under domestic custody and kept as London Bullion Market Association good delivery bars with 99.9% purity.
Central bank governor Ebson Uanguta said Namibia must identify new drivers of economic growth. He said expected foreign direct investment in oil and gas this year is likely to support economic activity.
Uanguta said the bank is preparing for structural changes in the economy, including digital innovation and developments in the oil and gas sector.
In the banking sector, deputy governor Leonie Dunn said non-performing loans have declined to 4.3%, the lowest level in three years.
She said the improvement follows an easing monetary policy cycle, lower inflation and a recovery from drought conditions.
Last year, the central bank directed commercial banks to reduce interest rate spreads on various loan products. Dunn said consumers have benefited from lower borrowing costs.
Uanguta also said the bank is working on the introduction of retail bonds.
“We experienced a lot of challenges. We have restarted the process. This time next year, we will launch the retail bonds,” Uanguta said.
