As of July 2021, before the general election that brought President Hakainde Hichilema and the UPND into power, the Bank of Zambia had purchased 478.76 kg of gold, approximately 15,392 ounces, worth $26.1 million. This is the amount that served as the country’s financial safety net during times of economic uncertainty, such as currency fluctuations, totaling only K604 million.
As of today, exactly four years since President Hichilema’s inauguration, the Bank of Zambia has accumulated 2.8 tonnes of gold reserves, valued at $300 million, approximately K9.9 billion. This $273.9million over what other previous governments had in reserve.
In simpler terms, a responsible parent would ideally invest their wealth in assets that can be easily converted into cash during times of crisis, such as real estate or farmland. At a household level, it is commonly known that, land maintains its value over time; a parent who buys a parcel of land for K20,000 would appreciate in value to K30,000 within two years. While liquidating property may take time, this parent is far much better than the one holding cash reserves.
In the case of a country, one safety value is having gold reserves, knowing that though the prices of gold fluctuate, gold prices have never fallen for many years. Gold reserves, particularly when significant, can instill confidence in a country’s currency, both domestically and internationally. When a central bank holds a substantial amount of gold, like we have today, it signals a commitment to financial stability and a willingness to defend the value of the kwacha. This can be particularly important during times of economic uncertainty or when a country’s currency is facing downward pressure.
If a Zambia experiences high inflation, Kwacha may lose value. Holding gold allows the Bank of Zambia to sell gold to absorb excess liquidity from the market, helping to control inflationary pressures. By selling gold, the Bank of Zambia can also increase the supply of foreign currency reserves, which can further help stabilize the exchange rate.
Even though other learned fellows, like Hon Christopher Kang’ombe, have argued on the basis that while Zambia has 2.8 tonnes, South Africa has 125 tonnes of gold and America 8,150 tonnes of gold insinuating that we have not done much as a country, I feel we must appreciate the efforts of our president. President Hakainde Hichilema’s government prioritizes the financial security of the country, as demonstrated by the increase of reserves from $26.1 million in 2021 July to $300 million in 2025.
Mr Winfred Mupakasi Silumbwe
27/8/2025
