Zimbabwe’s Finance Minister Urges Patience Amid Currency Transition Uproar

Mthuli Ncube calls for understanding as ZiG currency faces challenges.

by Adenike Adeodun

Finance Minister Mthuli Ncube has called for patience and understanding from the public regarding the recently introduced Zimbabwe Gold (ZiG) currency, following an outcry over disruptions to transactions. The Reserve Bank of Zimbabwe unveiled the ZiG currency last week as a replacement for the moribund local unit.

The ZiG currency is purportedly backed by gold, foreign currency reserves, and a basket of other minerals, a move aimed at stabilizing Zimbabwe’s monetary system and restoring confidence in the economy. However, the transition to the new currency has not been without challenges, prompting Minister Ncube to address legislators in Parliament on Wednesday, pleading for patience and cooperation.

Speaking to lawmakers, Ncube acknowledged the complexities involved in introducing a new currency, including printing new money and ensuring the availability of gold and other reserves. He emphasized the importance of building public confidence in the ZiG currency, highlighting the need for clear communication and education about its design and implementation.

“We believe that educating the public about the design of the currency and how it has been put together will give them that level of confidence,” said Ncube. “I would like to urge members of the public to have confidence in ZiG and use it all the time. It is everyone’s currency, and we should be proud of it. After all, a country derives pride from its currency.”

Despite the government’s efforts to instil confidence in the ZiG currency, Zimbabweans have faced challenges in adapting to the new monetary system. Many have been unable to access electronic banking platforms as service providers grapple with reconfiguring their systems to accommodate the ZiG currency. This has led to frustration among consumers and businesses alike, exacerbating existing economic woes.

According to John Mushayavanhu, the chief of the Reserve Bank of Zimbabwe, progress has been made in transitioning banking institutions and mobile bank service providers to the ZiG currency. Mushayavanhu stated that over 90% of these entities have successfully configured their systems and processes to accommodate ZiG, allowing for the resumption of banking services for the public.

However, some traders have been reluctant to accept the ZiG currency, preferring to continue using the previous local unit, the Zimdollar. Despite assurances from authorities that the Zimdollar remains legal tender until April 30, when ZiG notes and coins are set to be released, some businesses have refused to accept Zimdollar notes. Minister Ncube issued a warning of impending enforcement action against such vendors, stressing that the rejection of legal tender is illegal and will not be tolerated.

“We are going to send out our law enforcement agency to make sure that these vendors are dealt with,” Ncube stated. “It is illegal. Therefore, if it is illegal, then the law must take its course.”

Amidst these challenges, Zimbabweans have expressed mixed feelings about the ZiG currency. A survey conducted on the streets of Harare revealed a range of opinions among vendors, traders, and residents. While some welcomed the introduction of the new currency, others criticized the timing and implementation of the transition.

Vendors and traders reported difficulties in conducting transactions due to the delayed availability of ZiG currency, with some resorting to price increases to offset the inconvenience. Others expressed frustration over the lack of clarity and understanding about the new monetary system, leading to confusion and financial losses.

“The introduction of the new currency has caused me to lose my money, which was in the bank when they changed the RTGS to ZiG,” lamented one vendor. “I don’t even understand the rate they are using, given that we can’t access our bank accounts.”

Meanwhile, residents questioned the rationale behind introducing the ZiG currency before ensuring its widespread circulation and acceptance. Some commuters raised concerns about the impact of the currency transition on transportation costs, highlighting the need for clarity and stability in the monetary system.

As Zimbabwe grapples with the challenges of transitioning to a new currency, stakeholders remain hopeful that the ZiG currency will contribute to the stabilization of the economy. However, achieving widespread acceptance and confidence in the new monetary system will require effective communication, transparent governance, and proactive measures to address implementation challenges.


Source: Newsday

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