Zimbabwe’s Finance Minister, Mthuli Ncube, has announced a swift response to curb black market activity targeting the country’s newly introduced gold-backed currency, the Zimbabwe Gold (ZiG). This move comes just a week after the Reserve Bank of Zimbabwe (RBZ) unveiled the ZiG as a cornerstone of its strategy to combat inflation and stabilize the exchange rate.
Combating Currency Manipulation and Ensuring Transparency
Ncube made the announcement during a parliamentary session where he addressed concerns from legislators regarding potential manipulation of the ZiG by street vendors and currency traders.
“We have received information about street traders returning to manipulate the new currency,” Ncube said. “We will not tolerate this. Law enforcement agencies will be deployed to conduct a targeted operation to apprehend these vendors. They will be removed from the streets, and significant fines will be imposed on anyone caught trading on the black market.”
The new ZiG currency is currently operational electronically, allowing for cashless transactions. Physical notes and coins are expected to enter circulation by April 30th, 2024. However, legislators expressed concern that the black market activity could undermine public trust and destabilize the ZiG’s value before its full rollout.
Ncube acknowledged these concerns and emphasized the government’s commitment to transparency. “We are closely monitoring the situation and will take all necessary steps to ensure a fair and transparent foreign exchange market,” he said. “The ZiG is backed by Zimbabwe’s gold reserves, and we are confident it will bring much-needed stability to our economy.”
Addressing Civil Service Payroll and Public Concerns
Lawmakers also raised questions about the timeliness of civil servant salaries under the new system. Ncube assured them that while the availability of physical cash might be limited until later in April, electronic ZiG payments would be credited to civil servant accounts by April 18th.
However, public anxieties surrounding the new currency are understandable. Zimbabwe has a long history of hyperinflation, which eroded public trust in the local currency. The government is implementing an information campaign to educate citizens about the ZiG and its potential benefits. Also, this campaign aims to address misconceptions and assure the public that the ZiG is a reliable store of value.
The Zimbabwean government hopes that the ZiG currency, backed by the country’s gold reserves, will bring much-needed stability to the financial sector. Also, the crackdown on black market activity is a crucial step in this process. Moreover, by ensuring a fair and transparent currency exchange environment, the government aims to foster economic growth and improve the lives of Zimbabwean citizens.
The success of the ZiG hinges not only on controlling black market manipulation but also on building public trust. The government’s information campaign and its commitment to transparency will be crucial in this regard. If implemented effectively, the ZiG has the potential to become a stable and reliable currency, paving the way for a more prosperous future for Zimbabwe.
Source: New Zimbabwe
