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Definition

The gross gold and foreign exchange contingency reserves account (GFECRA) of the government is published every month. For example, in January 2024 the Reserve Bank reported that reserves were $62,5bn at the end of December 2023 - up from November's $61,72bn, mainly due to an increase in the US dollar price of gold and an increase in foreign currency reserves. The reserves play an important role in stabilising the value of the rand against other currencies, especially the US dollar. At the start of 2024 there was pressure on the Treasury to use the increase in reserves to reduce the government's deficit. In his budget policy statement at the end of February 2024 the Minister of Finance, Enoch Godongwana, announced that the government would be using R150bn of the profits of the GFECRA to help the government stabilise its balance sheet and reduce its cost of servicing its debt. The injection of funds would be "sterilised" with a further R100bn transfer from the GFECRA profits, bringing the total transferred to R250bn.

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