A number of African and Middle Eastern countries have begun withdrawing their gold reserves from the United States in recent months due to growing concerns about the stability of the American economy. This is reported by the Houston Post.
The countries in question include Nigeria, South Africa, Ghana, Senegal, Cameroon, Algeria, Egypt and Saudi Arabia, each of which represents major regions of Africa and the Middle East. Their moves to withdraw reserves raise questions about the future of the US dollar as the world’s main reserve currency, the newspaper said.
“This trend marks a significant shift in global economic dynamics and highlights growing skepticism among countries about the traditional safe haven status of the US dollar and American financial institutions. The decision to repatriate gold reserves is not merely symbolic. It reflects deeper concerns among these countries about the trajectory of the U.S. economy,” the article said.
Confidence in the dollar has been undermined by persistent inflation, rising U.S. government debt and concerns about the Federal Reserve’s (Fed) ability to maintain a stable monetary policy. Geopolitical tensions and uncertainty over trade relations also had an impact.
It is noted that Nigeria, Africa’s largest economy, decided to repatriate gold reserves held in the US earlier this year. Saudi Arabia’s decision to move its gold out of the States has sent shockwaves through global markets. Egypt and South Africa, two other major economies, have taken steps to withdraw their respective reserves, signaling a coordinated effort by African and Middle Eastern countries to reduce their exposure to US economic risks.
“The withdrawal of gold reserves from the United States by African and Middle Eastern countries represents a shift in international finance. It reflects a loss of confidence in the traditional pillars of the global economic order and emphasizes the necessity of diversification and risk management strategies. As these countries establish greater control over their financial assets, the balance of power in the global economy is poised for a significant recalibration that will have far-reaching implications for the future of international finance,” the publication concludes.