RBZ introduces New Gold backed Currency, Zimbabwe Gold (ZiG), to curb Inflation
Loraine Phiri
“The new currency, ZiG, will replace the Zimbabwe Dollar (ZW$) and co-circulate with other foreign currencies within the economy,” the RBZ stated in its monetary policy statement. This signifies a shift away from the ZW$ which has struggled with stability.
According to the monetary policy statement the transition to ZiG will involve converting all existing ZW$ balances in bank accounts, loans, advances, treasury bills, and outstanding auction allotments. The exchange rate will be determined by the closing interbank rate and the price of gold on April 5, 2024. Banks will be responsible for renaming all ZW$ accounts to ZiG accounts, while existing Gold-backed Digital Token (GBDT) accounts will remain separate.
Account holders with ZW$ notes and coins have 21 days from April 5th to deposit them into their ZiG accounts. Banks will accept these deposits during this period.
The Reserve Bank has established a system for those without bank accounts to exchange their ZW$ cash at specific banks within the same 21-day window.
“The Reserve Bank has made special arrangements for those without bank accounts to swap their ZW$ notes and coins at POSB and AFC Commercial Bank within 21 days after 5 April 2024,” reads the monetary policy statement.
For larger cash holdings exceeding ZW$100,000, banks will implement KYC and Customer Due Diligence (CDD) procedures to ensure financial transparency.
ZiG notes and coins shall be issued in denominations made up of 1ZiG, 2ZiG, 5ZiG, 10ZiG, 20Zig, 50ZiG, 100ZiG, and 200ZiG which will be distributed through the normal banking channels. The coins shall be introduced in due course.
This introduction of the ZiG marks a significant step for Zimbabwe’s monetary policy. The success of the currency will depend on various factors, including public trust in the new currency, maintaining a stable gold price and effectively managing the exchange rate.
NETIZENS views on the introduction of the new currency
Zimbabwe’s introduction of the ZiG currency has ignited a firestorm of online debate, sparking a spectrum of reactions from citizens. While some netizens adopted a humorous approach, wielding jokes and memes to navigate the situation, others expressed deep concerns about the new currency’s long-term viability. A sense of confusion and uncertainty permeated the online discourse, highlighting a perceived lack of clear information and education surrounding the ZiG rollout. This knowledge gap fuelled public apprehension, with some citizens voicing anxiety about the potential devaluation of their banked savings during the currency transition. A significant portion of the online community felt the government’s awareness campaign surrounding the ZiG fell short, leaving the public in a state of confusion.
Here is what netizens had to say:
1. At the mouths of many are questions about how the conversions from #Zimdollar to #ZiG has affected people’s money. Many already feel the loss of their Zimdollar. It’s not clear how this will pan out. What I’m also concerned with is the issue of pricing. How has the Zim government cushioned consumers against distortions in the market in the next few weeks as is the usual practice that customers are ripped off due to processes like these introduced by the #ReserveBankofZimbabwe? How is it going to affect the ordinary person on the streets, the women who are already hard hit by this economy, children in school, school fees?- @NyariMash.
2. The one thing that former @Reserve Bank Zim Governor, Gideon Gono, for all his other faults, was good at when introducing a new currency, was awareness raising. Those of us old enough, remember when he had those “Sunrise Campaigns.” It’s worth emulating #ZiG., “ said @ C.E Mambo
3. I hope the ZIG works. We’ve been going around in circles. Zimbabwe #ZIG,” said Nigel Ndlovu.
4. Trust in a currency is the true “currency’ of any currency (Econ 101) Once market stall holders, street tailors, barbers, shebeen queens and vendors start to accept Zimbabwe’s new #ZiG, then we’ll know we are onto something,’ said @ZiChivhu
5. Zig zag zig zag…we’re back in nursery school!#Zimbabwe #ZiG- @rudoarmourmusic
6. How many times have we changed currencies? How many times have we slashed zeros? This #ZiG is going to fail. Just like the bond note & the ZWL failed. You can bookmark this post- @tinanyams