Harare – The Reserve Bank of Zimbabwe (RBZ) is pressing ahead with its ambitious plan to make the Zimbabwe Gold (ZiG) the country’s only legal tender by 2030, a move that has ignited debate and raised eyebrows, particularly given Zimbabwe’s turbulent economic history and deep-seated challenges. While the RBZ insists that all necessary provisions are in place for a smooth transition to a mono-currency system, many Zimbabweans remain wary, haunted by past experiences of hyperinflation and the collapse of previous local currencies.
RBZ Deputy Governor Innocent Matshe, speaking at the Chamber of Mines of Zimbabwe 2025 State of the Mining Industry breakfast seminar in Harare, sought to allay fears and project confidence in the ZiG. He emphasised that the transition towards a mono-currency regime began two years ago and is expected to be complete by 2030.
“In terms of the anxieties around monocurrency, let me be as clear as I can be, that in most countries, they use their own local currency,” Matshe stated, echoing the standard practice in many nations.
However, the situation in Zimbabwe is far from standard. Years of economic mismanagement, corruption, and a lack of confidence in government institutions have created a unique set of challenges. The repeated failure of previous local currencies has left many Zimbabweans deeply distrustful of any new attempt to replace the US dollar, which has become a vital store of value and a preferred medium of exchange.
Matshe outlined the key prerequisites for a successful transition, including stability, low and stable inflation, adequate foreign currency reserves, and increased demand for the local currency.
“There are global guidelines. There are standard and regional guidelines. Those are the guidelines that we follow in terms of the law, in terms of inflation,” he explained, highlighting the importance of adhering to international benchmarks.
He also stressed the need for increased demand for the local currency, emphasising the critical role of recalibrating the percentage of government obligations paid in ZiG.
“The second is adequate foreign currency reserves that will be able to cover at least three to six months of interest,” Matshe said. “There was also need for increased demand for local currency to achieve mono-currency success, adding that it was critical that the country recalibrated the percentage of government obligations that were paid in local currency.”
But the question remains: can the RBZ truly achieve these conditions in a country plagued by corruption and a history of economic instability? Critics argue that without addressing the underlying issues of governance and corruption, any attempt to force a mono-currency system will be doomed to failure.
The pervasive corruption in Zimbabwe undermines confidence in all institutions, including the RBZ. If citizens believe that the ZiG can be manipulated or devalued at the whim of corrupt officials, they will be reluctant to embrace it.
Matshe expressed confidence in the stability of the financial sector, stating, “We have been fortunate that our financial sector is in favour, and we continue to monitor activity in this sector to make sure that stability regains.”
He also highlighted the importance of efficient and secure systems, noting ongoing efforts to digitalise all systems. “The first are efficient and secure. I am glad to say that these detailed systems that we have in our market are very secure,” Matshe said. “However, we are on a programme to digitalise all of our systems. Most of them are very slow. They are manual. They are not open.”
Matshe acknowledged the crucial role of fiscal and monetary policy aid in achieving stability. “And lastly, of course, we need fiscal and monetary political aid that we have seen over the last few months and this has enabled the stability that we go through right now,” he said.
Matshe sought to reassure the mining sector, a key contributor to Zimbabwe’s foreign currency reserves, that their foreign currency needs would be met. He applauded the mining sector for its contribution to Zimbabwe’s foreign currency reserves.
“This country is generating a lot more foreign currency, that is really important,” Matshe said. “Foreign currency or capital equipment or investment in mining will appear as if it’s a problem from the market side. But it’s not a problem from external sources of capital.”
“So in terms of, if you have funding and you need foreign currency, you will get foreign currency,” he added. “So there is absolutely no reason for miners to worry about foreign currency.”
Matshe revealed that the central bank no longer has outstanding foreign currency payment receipts, indicating that the monetary authorities have paid up US$60 million, which was outstanding from the auction system.
“Just this morning, I can tell you that we were able to clear all outstanding invoices from the invoices, which is something between US$10 million and US$60 million,” Matshe said. “Now, this we’ve been doing consistently over the past year or so. So foreign currency is not a problem, so all anxieties around foreign currency should not be there.”
He revealed that the central bank no longer has outstanding foreign currency payment receipts, indicating that the monetary authorities have paid up US$60 million, which was outstanding from the auction system.
“I can assure you that over the last 12 months, the rate at which we accumulated these results has been nothing but something that I can say was outstanding,” Matshe said.
“Why do I say that? Right now, we are standing at about a billion [in US dollars],” he said.
“That’s something that we have been able to do in the past year.
“What it tells you is that within the next three years, minimum, we will have the minimum import capital that we need.”
The RBZ’s gamble on the ZiG is a high-stakes one. If successful, it could pave the way for greater economic sovereignty and stability. However, if it fails, it could further erode public trust and plunge the country into deeper economic crisis.
For many Zimbabweans, the ZiG represents yet another leap of faith. Whether it will be a bridge to a brighter economic future or another painful reminder of past failures remains to be seen. The RBZ faces an uphill battle to convince a skeptical public that this time, things will be different. The success of the ZiG will depend not only on sound monetary policy but also on addressing the deep-r
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