African Central Banks have been advised to work with the mining industry to increase their gold reserves in order to weather the economic headwinds caused by the Covid 19 outbreak and the Russia-Ukraine war.
Vice President Mahamudu Bawumia, who made the announcement on June 1, 2022, stated that the consequences of these two issues will result in a reconfiguration of the global economic architecture owing to supply chain disruptions and dramatically limited availability to vital products.
This necessitates a larger sense of self-sufficiency, ranging from the creation of one's own medications to increasing agricultural output. But, according to Dr. Bawumia, the most important focus should be on increasing gold reserves in order to maintain the value of their currencies and offer balance of payment assistance.
Dr Bawumia, speaking at the opening session of the three-day West African Mining and Power Exhibition and Conference (WAMPOC/WAMPEX) in Accra, bemoaned the fact that, despite having an abundance of minerals and a long history of mining, African countries have little in the way of reserves and their currencies have little solid backing to ensure stability.
"The other day, I was looking at some statistics in terms of our gold reserves, and the data indicated that Ghana was the world's sixth greatest gold producer at the moment." So I went back to the central bank to look at our foreign exchange reserves in terms of gold reserves.
And when I crunched the numbers, we were around 79th in the world in terms of gold reserves.
"And in terms of significant gold producers, that circumstance was very much the case for many African countries." If you look at the world's largest gold reserves, for example, in terms of Central Bank Holdings, the United States has about 8000 tonnes, Canada has over 2000 tonnes, and so on. As a significant gold producer, Ghana has 8.7 tonnes of reserves. And this was the situation when I expected South Africa to be much more prominent, but it wasn't, and I was startled.
"I mean, we've been mining for over a century, and one would think that our gold reserves, at the very least, would be far more substantial given the role gold reserves play in currency stabilization and balance of payment support."
blogpay
