Africa-Press – Zimbabwe. Zimbabwe’s Finance Minister, Mthuli Ncube, has said the country is not yet fully prepared to transition to a mono-currency system, as it still needs to meet several key benchmarks to support the local currency, ZiG.
Ncube said that for a mono-currency to be sustainable, Zimbabwe must first ensure it has sufficient foreign currency reserves to cover six months of imports.
He also said the country must make progress in reducing its foreign debt, which currently stands at approximately US$21 billion. Said Ncube (via The Herald):
The question is whether there was any consideration for the mono currency. Not as yet. The reason is that you need certain conditions to be in place first before you adopt a mono currency.
First of all, you need to be sure that you have adequate foreign reserves to defend the domestic currency, the ZiG, if ever it comes under speculative attack.
There are certain rules and benchmarks around the world such as six months… so that you will then be able to cover six months of imports without needing further flaws. Really, it’s about being able to defend the currency.
Secondly, we need to make progress on foreign debt, which will also pose risks to the value of any currency. If you have arrears or high external debt, that will pose a risk to your currency.
So, again we need to make sure that in our arrears clearance programme, we make progress towards clearing those.
Zimbabwe introduced its new currency, the ZiG, in April 2024. The ZiG is backed by gold reserves and other precious metals.
In 2024, Reserve Bank of Zimbabwe (RBZ) Governor John Mushayavanhu presented a de-dollarization roadmap, outlining a gradual shift from the country’s heavy reliance on the US dollar to increased use of the ZiG. He said at the time:
The Central Bank has come up with a roadmap towards de-dollarisation, and as we go towards 2030, we want to do it gradually so that maybe by the end of the year, we are at 70/30, in 2025 we are at 60/40, then in 2026 we are at 50/50 and after that we will not even care to monitor it because it will happen on its own.
You will also be seeing Government reviewing the amount you pay in ZiG for tax as we go along on that roadmap.
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