Why African central banks are buying gold — and repatriating it

Central bank gold buying has been a global story for several years; the African twist is domestic sourcing. Ghana's Gold for Reserves programme, the Bank of Uganda's domestic gold purchase programme, the Bank of Tanzania's purchases from local miners and Zimbabwe's gold-backed currency framework all build reserves by buying local production in local currency — accumulating hard assets without spending a dollar of foreign exchange, while formalising artisanal output that once left the continent unrecorded.

The motivations are layered. Gold is the classic hedge against the dollar cycle that whipsaws African balance sheets. It carries no counterparty risk — a property that reserve managers worldwide have re-examined since the freezing of the Central Bank of Russia's reserves in 2022. And for gold-producing countries, buying domestic output supports the formal market and reduces smuggling incentives.

Zimbabwe has taken the logic furthest: since April 2024 its currency framework, the ZiG, has been explicitly anchored to gold and foreign-exchange reserves held by the Reserve Bank of Zimbabwe. Most reserve managers stop well short of that, targeting modest allocations — meaningful diversification without abandoning the liquidity of dollar and euro assets that debt service still requires.

Repatriation is the quieter trend, with several central banks publicly discussing or implementing moves of custody from London and New York toward domestic or regional vaults. The trade-off is real: metal at home is politically sovereign but cannot be lent, swapped or pledged as readily. The emerging compromise is a split book — enough offshore to remain a market participant, enough onshore to remain unquestionably in control.

The result: African official gold holdings are rising from a low base, and the continent's reserve composition is slowly starting to look less like a legacy of Bretton Woods and more like a portfolio someone actually chose.