gtag('config', 'UA-12595121-1'); Deputy Minister Acknowledges Gradual Introduction of ZiG Currency Amid Local Currency Shortage – The Zimbabwe Mail

Deputy Minister Acknowledges Gradual Introduction of ZiG Currency Amid Local Currency Shortage

David Kudakwashe Mnangagwa
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Harare, Zimbabwe – Deputy Minister of Finance, Economic Development, and Investment Promotion, David Mnangagwa, has confirmed that the rollout of the Zimbabwe Gold (ZWG) currency, introduced in April, has been marked by a gradual market release against the backdrop of a notable scarcity of local currency.

Since its introduction to replace the Zimdollar (ZWL$), the limited availability of ZWG has sparked concerns about a potential increased reliance on the United States dollar, potentially undermining government efforts to de-dollarize the economy.

Both the government and the Reserve Bank of Zimbabwe (RBZ) have reassured the public that banks have sufficient ZWG to meet demand. However, Mnangagwa explained in an interview with NewsDay Business that the cautious distribution strategy is designed to protect the currency’s value.

Mnangagwa highlighted a significant change from the ZWL$ era, noting a reduced circulation velocity as holders of ZWG tend to retain it due to its perceived stability. He emphasized that this measured approach is intended to prevent an excessive money supply, aligning with a structured framework aimed at maintaining financial stability.

Addressing concerns about cash shortages affecting daily operations and consumer livelihoods, Mnangagwa stated that the RBZ has implemented measures to mitigate these issues, including establishing withdrawal points for ZWG in various cities through Homelink.

Economist Vince Musewe emphasized the importance of balancing money supply to support economic activity, noting that adequate liquidity is crucial for savings and transactions, which are essential for economic growth. He warned that insufficient ZWG availability could disrupt economic activities and urged the RBZ to manage the currency effectively to avoid negative impacts on the economy.

Source: NewsDay