Zimbabwe Central Bank Intervenes to Address ZiG Currency Shortage

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HARARE, — Zimbabwe’s central bank has taken steps to alleviate a shortage of the newly introduced Zimbabwe Gold (ZiG) currency, addressing concerns that the scarcity is disrupting daily transactions.

The gold-backed ZiG was launched on April 5 to combat inflation and promote currency stability. However, the limited availability of the currency has created challenges for the public in conducting everyday transactions.

In a press release on Wednesday, Reserve Bank of Zimbabwe (RBZ) Governor John Mushayavanhu announced that the bank has partnered with its financial services subsidiary, Homelink, to allow the public to swipe for local currency in smaller denominations of ZiG1, ZiG2, ZiG5, and ZiG10.

“These small denominations are intended to provide the public with necessary change, while the central bank retains the larger denominations of ZiG20, ZiG50, ZiG100, and ZiG200 to curb the parallel market and control inflation,” Mushayavanhu explained.

Consumer prices fell by 2.4 percent from April, according to data released by the Zimbabwe National Statistics Agency on May 29. This decline followed the introduction of the ZiG, which aims to stabilize the exchange rate and manage inflation.

The RBZ is dedicated to ensuring the adequate circulation of local currency to support normal business operations and economic activities, Mushayavanhu emphasized.

“The bank appeals to all individuals, commuters, public transport operators, retailers, informal traders and their associations, vendor associations, and other key stakeholders interacting with the public to visit their nearest Homelink branch and swipe for ZiG cash using their local currency debit or credit cards starting June 10,” he stated. He also noted that foreign currency could be exchanged for ZiG at Homelink branches.

Mushayavanhu highlighted that the arrangement with Homelink is part of broader initiatives to ensure sufficient ZiG cash availability in the economy. “This initiative will be expanded to other bureaux de change in the future,” he added.

The introduction of ZiG aims to curb inflation and stabilize the currency, but the central bank’s proactive measures are crucial to ensuring the new currency’s success and maintaining economic stability in Zimbabwe.