GOODBYE US$ DOLLAR: Finance Minister Mthuli Ncube instructs government to pay everyone in ZiG currency

HARARE – A significant shift in Zimbabwe’s economic landscape is underway, as Finance Minister Mthuli Ncube has issued a directive mandating the exclusive use of the Zimbabwe Gold (ZiG) currency for all local government procurement. This instruction, subtly embedded within a broader announcement concerning a National Standard Price List (NSPL), marks a determined effort towards the de-dollarisation of the nation’s public sector. The move has inevitably reignited intense debate over Zimbabwe’s monetary policy and its implications for the wider economy.

Announced on Friday, 13 March 2026, the directive stipulates that all ministries, departments, and agencies (MDAs), alongside state-owned enterprises and local authorities, must now settle payments with local suppliers solely in the domestic currency. The Treasury frames this policy as a crucial step to enhance transparency and rectify the long-standing issue of price inconsistencies within public procurement. However, for many astute economic observers, the true significance of this development lies not merely in administrative reform, but in a calculated attempt to integrate the private sector more deeply into a ZiG-centric financial system.

The National Standard Price List itself is designed to standardise the costs that government entities incur for commonly procured goods and services. Minister Ncube articulated that this framework is a cornerstone of the 2026 national budget, specifically aimed at bolstering domestically produced goods. “The implementation of the NSPL is expected to enhance cost savings, transparency, and efficiency in public procurement, thereby supporting national development priorities,” the Minister affirmed in his statement. By enforcing uniform pricing across the public sector, the government seeks to improve oversight of public expenditure and mitigate the historical problem of inflated invoicing that has burdened the national fiscus.

Despite the government’s stated intentions, the requirement for payments to be made “solely in the local currency” has generated considerable apprehension within the business community. For many years, the United States dollar has served as the preferred medium of exchange in Zimbabwe, offering a degree of stability in an economy frequently destabilised by hyperinflation and currency volatility. The ZiG, launched in April 2024 and purportedly backed by gold and foreign currency reserves, was introduced with the explicit aim of breaking this cycle. While official reports suggest a degree of stability—with the interbank exchange rate hovering around 26.95 ZiG per 1 US dollar in early 2026—the practical economic realities on the ground remain considerably more intricate.

Economists in Harare have been quick to highlight the apparent contradictions in the government’s approach. While suppliers are now compelled to accept ZiG for their services, the state itself continues to demand payment in US dollars for essential public services. Passports, various civil documentation, and even fuel purchases are still predominantly priced and payable in foreign currency. This “dual-track” system has led to accusations of inconsistency and a perceived lack of genuine confidence in the very currency the government is striving to promote.

One Harare-based economist, who requested anonymity due to the sensitivity of the matter, remarked, “The price standardisation on its own is unremarkable – governments do that. What stands out is insisting that every supplier payment will be in ZiG. That’s not a procurement reform. That’s currency policy dressed up as procurement reform.”

The economist further underscored the credibility deficit created by the government’s own reluctance to fully embrace the ZiG: “You cannot tell suppliers to accept ZiG while you yourself demand dollars for passports. That kind of selective application destroys the credibility of any monocurrency narrative. People aren’t blind to the inconsistency.”

This sentiment finds resonance with the Zimbabwe Congress of Trade Unions (ZCTU), which recently rejected Minister Ncube’s calls for “realistic” wage demands. The ZCTU contends that the Minister’s perspective overlooks the fact that approximately 84% of the Zimbabwean economy operates informally and largely transacts in US dollars. For the average worker and small-scale entrepreneur, the US dollar is not merely a preference but a vital tool for economic survival in a market where the ZiG’s purchasing power is often regarded with considerable scepticism.

Zimbabwe’s history of currency reform is extensive and often fraught with difficulty, characterised by the introduction and eventual collapse of the bond note, the RTGS dollar, and the original Zimbabwe dollar. Each of these previous attempts was launched with similar official optimism, only to succumb to structural economic pressures, the persistent demand for hard currency in the parallel market, and a fundamental erosion of public trust. The ZiG was intended to chart a different course, with the Reserve Bank of Zimbabwe (RBZ) significantly bolstering its gold reserves by approximately 250% between April 2024 and December 2025. By late 2025, these reserves had reportedly reached 1.1 billion US dollars, sufficient to cover around 1.2 months of imports.

Despite these concerted efforts, the parallel market continues to cast a long shadow over the official economy. While the official exchange rate indicates a strengthening ZiG, black market rates are reported to be between 1.5 and 3 times higher, potentially ranging from 40 to 100 ZiG per 1 US dollar.

This significant disparity places considerable pressure on businesses that supply the government. These companies must now align their pricing with the NSPL benchmarks—accessible via the Treasury and PRAZ websites—and accept payment in ZiG, even as they are often compelled to source their own inputs and raw materials in a market where hard currency remains the predominant requirement.

The increased compliance complexity introduced by the NSPL presents another hurdle for the private sector. Suppliers who fail to conform their pricing to the published benchmarks risk being entirely excluded from government procurement processes. For importers, the predicament is even more acute: they are expected to sell to the state at regulated ZiG prices, while their own operational costs are intrinsically linked to the very US dollars that the government is attempting to diminish from the procurement cycle.

Minister Ncube has consistently emphasised that the stability of the ZiG is a non-negotiable policy objective. The Treasury has cited a notable reduction in annual inflation—from 82.7% in September 2025 to 32.7% in October 2025—as compelling evidence of the gold-backed currency’s efficacy.

Furthermore, the ZiG reportedly appreciated by 1.5% against the US dollar in the initial weeks of 2026, a statistic frequently highlighted by the government to support its case for broader adoption of the currency.

However, public sentiment remains largely circumspect. Across social media platforms and within business circles, the recent announcement has inevitably evoked memories of previous unsuccessful currency initiatives. The scepticism extends beyond mere statistics; it is rooted in the lived experiences of Zimbabweans who have witnessed their savings diminish through successive “reforms.” The government’s continued practice of maintaining a “dollar window” for its own fees, whilst simultaneously mandating the local currency for others, is widely perceived as an indication that the state is not yet fully committed to its own monetary creation.

The National Standard Price List and its accompanying payment directive represent the latest in a series of public financial management initiatives spearheaded by the Ncube-led Treasury. While the stated objectives of cost-saving and transparency are commendable, the underlying currency mandate suggests a far more ambitious—and potentially perilous—agenda. By compelling government suppliers to transact in ZiG, the state is endeavouring to generate a demand for the currency that has, to date, proven elusive in the broader market.

As this policy begins to take effect, the nation’s attention will be keenly focused on the Procurement Regulatory Authority of Zimbabwe (PRAZ) and the Treasury to observe the stringency with which these new regulations are enforced. Will the government genuinely transition towards a “Goodbye US Dollar” reality, or will this directive merely become another chapter in the complex narrative of Zimbabwe’s ongoing quest for a stable domestic currency? For the immediate future, the business community is left to navigate a new terrain of regulated prices and mandatory ZiG payments, while the pervasive influence of the US dollar continues to loom large over the economy.

The directive is unequivocal, the benchmarks are established, and the Treasury’s resolve is undergoing a critical test. Whether the ZiG can truly ascend to become the “sole transactional currency” remains an open question, but for those who supply the Zimbabwean government, the era of the US dollar has, at least officially, drawn to a close. The immediate challenge lies in reconciling official policy with the economic realities of a nation that has, through bitter experience, grown wary of any currency not possessing the inherent strength of the greenback.

The implementation of the NSPL will be rigorously scrutinised by both domestic and international observers. It represents a bold strategic manoeuvre by a Finance Minister who has frequently been at the epicentre of Zimbabwe’s economic challenges. Should it succeed, it could potentially deliver the much-needed stability the country yearns for. Conversely, if it falters, it may simply augment the extensive list of currency experiments that have characterised the Zimbabwean economy over the past two decades. For the present, the instruction is absolute: transact in ZiG, or forgo business with the state.

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