‘ZiG a game changer for economy’

Source: The Herald – Breaking news.

‘ZiG a game changer for economy’ 
Speaking during a plenary session at the recent 10th CEO Africa Roundtable conference in Victoria Falls, President Mnangagwa expressed confidence in the currency and called on executives to provide the Government with ideas for maintaining currency stability.

Nqobile Bhebhe

Bulawayo Bureau

ANCHORING the Zimbabwe Gold currency (ZiG) with gold is a solid and elaborate strategy for restoring currency stability, which lays a strong foundation for Zimbabwe’s economic growth, President Mnangagwa has said.

As such the business sector and ordinary Zimbabweans should take pride in the currency and put it to maximum use.

Speaking during a plenary session at the recent 10th CEO Africa Roundtable conference in Victoria Falls, President Mnangagwa expressed confidence in the currency and called on executives to provide the Government with ideas for maintaining currency stability.

When asked about plans to maintain the ZiG’s stability, President Mnangagwa admitted that the economy has previously faced challenges.

However, he said the decision to use gold as the foundation for the newly introduced currency is nothing short of a master stroke.

The Reserve Bank of Zimbabwe (RBZ) in April this year introduced the ZiG as part of a raft of policy interventions to address exchange rate volatility, curtail inflation and restore macro-economic stability.

The new currency is backed by precious minerals, mainly gold, and foreign currency.

 The transacting public has embraced the new currency, which has brought exchange rate and price stability, boosting the country’s economic prospects.

Before the 2024 monetary policy statement and introduction of the ZiG, exchange rate and inflation volatilities were the major challenges that undermined the prospects of the Zimbabwe dollar under the multi-currency system.

In the past, the exchange rate volatility, which drove rapid inflationary pressures in the market, was occasioned by high demand for foreign currency as a store of value, reduced confidence due to currency volatility at the time as well as the widening gap between the interbank and black market rates.

Said President Mnangagwa: “We have gone through these (economic) challenges and currently, we have introduced ZiG, meaning that with all the tribulations we have gone through, we have now decided that our currency be anchored on gold.

“This is a new approach to stabilising our economy. Personally, I am satisfied that what we have done now, anchoring our currency on gold, is a sound approach to a stable currency.

“In the past, our currency was being fought left, right and centre. For now, I think it is a solid foundation and, as we go forward, it is upon you (executives) to continue guiding us.”

President Mnangagwa narrated in detail the extensive and meticulous two-and-a-half-year preparatory groundwork that was done before introducing ZiG.

He said Zimbabweans must be proud of the introduction of ZIG.

“With ZiG, our currency will be backed by gold reserves, which we have been accumulating for two-and-a-half years. 

“We have been setting aside 10 percent of our monthly gold production and now we have enough reserves to support our currency,” President Mnangagwa said.

Zimbabwe has 2,5 tonnes of gold and US$300 million in cash reserves to back the new currency. 

Of the gold reserves, 1,5 tonnes are held at the RBZ vaults and one tonne is held offshore.

In his remarks, CEO Africa Roundtable Board Chairman, Mr Oswell Binha, said the business sector is behind ZiG, adding that they are impressed with its solid performance.

 “Stakeholders in this conference would like to acknowledge how you have considered our plea to the Government to provide the market and the economy with a dependable clear road map on the ongoing currency reform agenda.

“Apparently, we recognise the efforts that the Government has made and so far, Your Excellency, the structured currency is working.

“We are going to engage the Government in ensuring that we sustain the trajectory that the Government has set.”

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