Business Reporter
A MEMBER of the Reserve Bank of Zimbabwe (RBZ)’s monetary policy committee has said universal acceptance of Zimbabwean Gold (ZiG) will help the country de-dollarise.
Persistence Gwanyanya, a leading economist, said in an interview on the side-lines of CEO Africa Roundtable annual conference last week, ZiG was part of the country’s strategy towards attaining a mono-currency system by 2025.
The central bank recently availed the gold-backed digital currency for domestic transactions to deal with increasing dollarisation levels.
President Emmerson Mnangagwa announced at the same event government would press ahead with its plan to end dollarisation in 2025.
However, the US dollar currently dominates transactions, with 80% of transactions taking place in the greenback.
“We recently introduced ZiG, which has a purpose of value presentation,” he said. “If this ZiG is universally accepted (it will) reduce pressure on the US dollar and reduce dollarisation levels in the economy. That is going to benefit the economy in a big way. I believe that inflation will never go beyond three digit figures.”
On Oct. 5, the gold-backed digital token called, Zimbabwe Gold (ZiG), officially launched as a payment method. The launch was announced by the Reserve Bank of Zimbabwe (RBZ).
The RBZ introduced its new project in April 2023, highlighting that every issued digital token would be backed by a physical amount of gold held in the bank’s reserves. The RBZ first started issuing physical gold-backed tokens in 2022, claiming their successful adoption.
The mission behind both physical coins and the newly introduced ZiG is to persuade local investors to put their money into national assets and not United States dollars, which is not an easy task in a country with triple-digit inflation. RBZ Governor John Mangudya stated:
“The issuance of the gold-backed digital tokens is meant to expand the value-preserving instruments available in the economy and enhance divisibility of the investment instruments and widen their access and usage by the public.”
The digital tokens can be stored in either e-gold wallets or e-gold cards and are tradeable for peer-to-peer and business transactions.
