Zimbabwe Introduces ZiG: A New Gold-Backed Currency

• Zimbabwe, aiming to stabilize its economy amid years of turmoil, has introduced a new gold-backed currency named ZiG, short for "Zimbabwe Gold." This decision comes amidst hyperinflation and a volatile financial environment.
• Led by central bank governor John Mushayavanhu, the ZiG currency will adopt a market-determined exchange rate, replacing the depreciating RTGS dollar. The issuance of new notes, ranging from denominations of 1 to 200, is intended to instill confidence in the local currency. Furthermore, the introduction of coins seeks to address the shortage of US coins, which has prompted unconventional methods of providing change.
• Despite the launch of ZiG, the US dollar remains the preferred currency for transactions, reflecting entrenched preferences among Zimbabweans. Skepticism lingers due to past unsuccessful attempts at currency stabilization, notably the bond note, which collapsed amidst government overspending.

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Published date : 10 Apr 2024 05:03PM