Zimbabwe’s largest independent brokerage, Imara Asset Management, says the government should restore the trust of citizens rather than suggest they be forced to abandon the US dollar, reported Bloomberg.
Imara Asset Management chief executive officer John Legat and chief investment officer Shelton Sibanda said:
Rapid local currency depreciation episodes and the attendant hyperinflation years are still fresh in the minds of most Zimbabweans.
Imara said those experiences eroded confidence in Zimbabwe’s economic and monetary authorities and the “focus for the government should be on building that lost trust.”
Zimbabwe launched a new gold-backed currency called the ZiG ((Zimbabwe Gold) in April 2024, its sixth attempt in 15 years to have a local currency.
Previous efforts collapsed amid sky-rocketing inflation and 80% of payments are now made in United States dollars.
President Emmerson Mnangagwa recently suggested the ZiG could become the sole legal tender as early as 2026.
Zimbabwe briefly banned the use of foreign currencies in June 2019 following the reintroduction of the Zimbabwe dollar, which it had abandoned a decade earlier.
The currency ban was, however, reversed at the onset of the coronavirus in March 2020.
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