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RBZ Says Reserves Backing ZiG Rose To US$370 Million

6 months agoMon, 08 Jul 2024 11:18:55 GMT
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RBZ Says Reserves Backing ZiG Rose To US$370 Million

The Reserve Bank of Zimbabwe (RBZ) says the cash and mineral reserves supporting the new currency, Zimbabwe Gold (ZiG), have increased from US$285 million to approximately US$370 million in the past three months.

In an interview with The Sunday Mail, RBZ Governor John Mushayavanhu asserted that the central bank has consistently ensured that ZiG remains fully backed at all times. He said:

The Reserve Bank has been accumulating reserves from royalties of gold and conversion of in-kind royalties of other precious minerals such as diamonds, lithium and platinum to gold reserves.

As a result, the total reserves have progressively increased by about 30 per cent, from US$285 million as of April 5, 2024, to above US$370 million as of the end of June 2024.

The ZiG is backed by a reserve of foreign currency and precious metals, primarily gold, held by the central bank.

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Mushayavanhu added that the ZiG had performed “exceptionally well” since its introduction on April 5 2024. He said:

Concerning the performance of ZiG in the past three months, I am happy to say that the new structured currency has lived up to expectations and has performed exceptionally well.

As a structured currency, the expectation is that the ZiG exchange rate should mimic the developments in the price of assets backing it, which include the price of gold and other precious minerals, and inflation differentials between the US dollar and ZiG inflation.

The Reserve Bank remains committed to maintaining the full backing of the new currency and engender desirable conditions for currency and exchange rate stability in the macro-economy.

Last week, President Emmerson Mnangagwa announced that the country’s new currency, the ZiG, will become the sole legal tender within the next two years, once it has fully penetrated the market.

However, not everyone is in full support of the President’s timeline. Prominent Zimbabwean economist Gift Mugano has cautioned the government against rushing to make the ZiG the sole legal tender before first establishing the minimum requirements for the new currency to succeed.

Mugano warned that prematurely enforcing the ZiG as the lone legal tender could have adverse consequences if the necessary economic conditions are not yet in place. Said Mugano:

The introduction of a local currency requires basic minimum requirements such as current account surplus, fiscal consolidation (we have to reduce our debt significantly to regions averaging 30% of GDP); a highly productive economy; single-digit inflation and stable exchange rates. In reality, it is very difficult to attain all these conditions at once. However, we must strive to build a productive and competitive economy.

I would like to argue that the best way to back our currency is to back it with production. We need disruptive structural policies, that is, industrial policy, agricultural policy, trade policy and energy policy & energy master plan. These policies must be anchored on twin objectives, that is, import substitution and export drive.

More: Pindula News

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24 Comments

sadness · 6 months ago
hmmm
Thulani · 6 months ago
propaganda will not solve the trust we have the zanu pf economic policy.
Anonymous · 6 months ago
And people with no money are arguing! You want U$ but if I give you a $5 note buying something worth $2 you struggle to give change. So what are you keen on the $ for when you can't afford it?
👀👀 · 6 months ago
heya rinokwirawo mutengo mari dzacho dzichiendepi ,hachisi chicherwa chedu here chekuti they can monitor
baba jukwa · 6 months ago
it's not that the reserves have grown but goridhe raka kwira mutengo ikozvino riripa 70 per gram saka that doesn't mean growth but maturity of reserves
Chibaba · 6 months ago
Pure lies about useless Zig hapana anoda that tissue paper.
Anonymous · 6 months ago
Handiti tiri kuzvionera tega ZIG racho richishaika....
stylez · 6 months ago
dzisai rand ne usd munyika muno tisare nezig tione kushanda kwaro andt murikutemba kut usd nerand zviri kushanda dai zvisizvo ringai rakafa kare
· 6 months ago
Ko airtime tozotenga nei? Handisati ndaona vendor anotengesa airtime yemaZiWiG.
Anonymous · 6 months ago
@nc, all currencies worldwide have some regulations, and zvinotoda some kind of kufosekedza as lond as it is good for the country because we know you economic saboteurs want our currency to fail.
Dyoo nemo-nemo · 6 months ago
LIAR.. where in world have you ever heard of police & army forcing people to accept a currency . Here in Zim thers Saying yekutin "Handingadiwe nemumhu wese, handisi Mari" if it's proper money everyone loves to have it. but yenyu haisi Mari that's why pple don't want it. money is attractive by its nature of giving it's possesser the power to acquire & enjoy. but in Zim -except for a few brainwashed Zanu pfs- we now know they print paper in order to buy off the USd/rand from us votora USd Ivo . Gono did it with bearer cheques before Brazenly wiping out everyone's bank balance to zero in 2009 - 1 January. Right now who has physically seen that gold purpoted to be at R-B-Z backing Zig? taking Zanu at it's word is utter foolishness. Rushwaya was cought at the airport with gold bars(not Gold ore-- how many others are there sipphoning?) and yet You expect to find any gold at reserve bank.
iGwee · 6 months ago
Wvat is the calue ok a kg of gold 🥇
iGwee · 6 months ago
Zimbabwe has 2,5 tonnes of gold and US$300 million in cash reserves, positioning it favourably to introduce a new structured currency, authorities have claimed. Saka dzaive nhema hr
nc · 6 months ago
riri ku peformer ne ndaa yekuti muri kufosekedza vanhu chimbomirai kufosekedza tione kuti re peformer here
Francis January · 6 months ago
kana rine simba harina need yekunzi razodayi ,,tofanira kuona buying power,,
...,. · 6 months ago
the zig has not had a real test yet. it's like they are feeding for a fight and it is growing muscle but not training or exercising
Mai Chimuti · 6 months ago
Baba ava vari kutaura semunhu anoti "Wakaona here matambiro arikuitwa na Ronaldo mazuvano ", ku munhu asina TV
Dyoo nemo-nemo · 6 months ago
dyooo nechimuti....
Tese · 6 months ago
Mumwe anochema chete neZig ....

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