Zimbabwe’s New Currency is Called ZiG

Zimbabwe's new currency was developed by authorities to combat galloping inflation, which has already surpassed 55 percent in the first four months of the year

The banknotes and coins of this southern African continental state’s new currency, called ZiG, an acronym from “Zimbabwe Gold,” were put into circulation by the Zimbabwe Mint. The new currency, pegged to gold, was introduced by authorities to counter annual hyperinflation, which has already exceeded 55 percent in the first four months of the year.

The Reserve Bank of Zimbabwe (RBZ), the country’s central bank, introduced the ZiG on April 5, replacing the Zimbabwean dollar, which had lost value due to hyperinflation. The ZiG joins a basket of currencies accepted as legal tender in Zimbabwe, with the US dollar currently dominating the country’s economy with over 80% of all domestic transactions.

The issuance, which began on May 5, came at the end of phasing out old banknotes by Zimbabwean credit institutions. The highest available denomination will be a 200-ZiG bill, worth about $15. Currently, a weekly withdrawal limit has been set at 3000 ZiGs for individuals and 30,000 for companies.

The monetary reform has raised many doubts in this African country, after which Zimbabwe’s Finance Minister Mthuli Ncube ordered all government agencies on May 8 to accept ZiG payments. In his statement, the minister emphasized that the ZiG is now the official unit of exchange for transactions: “All ministries, departments, agencies, and the private sector are requested to adopt and recognize the ZiG as the official currency for all financial operations, transactions, and for payment for all goods and services, with immediate effect,” emphasized Ncube, according to whom “government will soon introduce regulations to ensure that businesses adapt to the official exchange rate, which will be freely determined by the banking system based on supply and demand.”

In the capital Harare, residents queued up at banks to get the new currency. “People can’t wait to have their own currency because until now we have been forced to use the US dollar. It’s a relief for people. For example, public transportation tickets cost 50 cents (US – ed.) cents, but we had to pay one dollar because there were no smaller denominations. “Now, with this new currency, we can pay reasonable rates,” Harare local Letwin Chimanga told China’s Xinhua news agency.

According to RBZ’s exchange rate updates, ZiG, which originally traded at an exchange rate of 13.56 per US dollar, is currently trading at 13.43 per dollar. And as RBZ Governor John Mushayavanhu said, “the new currency is backed by gold, has other precious minerals, and Zimbabwe’s national reserves denominated in foreign hard currency.”

È già apparso il mercato nero per il traffico dello “ZiG”