Reserve Bank of Zimbabwe (RBZ) Governor John Mushayavanhu recently unveiled plans for the introduction of a new currency, ZiG (Zimbabwe Gold), which will be backed by a diverse array of assets including foreign currencies, gold, and other precious metals.

During the presentation of the 2024 Monetary Policy Statement (MPS) on April 5, 2024, Mushayavanhu disclosed that the ZiG notes would be issued in various denominations such as 1, 2, 5, 10, 50, and 100, with corresponding coin values for half and quarter ZiG.

Speaking at a press briefing in Harare, Mushayavanhu revealed that the ZiG would be launched on April 8 at an initial exchange rate of 13.56 per dollar, alongside a new fixed interest rate of 20%.

He emphasized that banks would be required to convert their existing Zimbabwean dollar balances into the ZiG. “We aim to establish a robust and steady national currency. Resorting to currency printing is not a viable solution, especially under my leadership,” he asserted.

According to a report by Bloomberg, the introduction of ZiG marks Zimbabwe’s sixth attempt to establish a functional local currency since the crisis of 2008, when hyperinflation soared beyond 500 billion per cent, rendering the currency practically worthless.

The current Zimbabwean dollar has depreciated significantly on the official market since the beginning of the year, ranking as the world’s second worst-performing currency, having lost four-fifths of its value.

The devaluation of the currency has led to an overwhelming majority of transactions being conducted in dollars, with inflation accelerating to 55.3% in March from 47.6% the previous month.

Mushayavanhu expressed optimism that the inflation rate would taper off to between 2% and 5% by the end of the year following the implementation of the currency reforms. He added, “We will refrain from engaging in any quasi-fiscal activities. It is not our mandate to undertake tasks beyond our jurisdiction.”