Zim introduces another new currency, the”ZiG”
The new Reserve Bank of Zimbabwe (RBZ) governor Dr John Mushayavanhu today unveiled the new structured currency, the “ZiG”.
Patricia Rwafa
Addressing the country, Mushayavanhu said the ZiG is a “structured currency”. He said unlike typical fiat money, the ZiG will not rely solely on the government trust, instead, it will be supported by a concrete asset, like the gold reserves that were recently presented to President Mnangagwa by the RBZ.
The new currency will replace bond notes, which have been in freefall since 2019, losing 800% of value against the United States dollar in 2023 alone.
“Denominations of such would be similar to any other fiat currency meaning ZW$1, ZW$2, ZW$5, ZW$10, ZW$50, ZW$100, ZW$200, and others. The RBZ can call them structured currency or ZiG, a name they have already been using (Zimbabwe Gold).
According to John Mushayavanhu, dividing the current ZWL rate by today’s gold price of 1 ZiG is just US 6 cents. Meaning USD1 is Approximately 17 ZiG.
Starting Monday, all Zimdollar balances will be converted to the new gold-backed ZiG currency at Z$1=13.5686 ZiG.
“With effect from today, banks shall convert the current Zimbabwe dollar balances to ZiG. Zimbabweans have 21 days to exchange ZWL notes for ZiG.
“I don’t believe in taking people’s money. The ZiG will circulate with other currencies in the basket,” he said.
Meanwhile, street money changers in Westgate, Harare were not optimistic about the new currency labelling it “the usual”.
“We have seen this so many times and in no time this new currency will follow suit. Within a month the rates will be different from the ones announced,” one money changer said.
The new ZiGs will be backed by foreign currency and by gold reserves, meaning the currency is tied to the value of a specific amount of gold.