THE Reserve Bank of Zimbabwe (RBZ) has acknowledged anxieties within the business sector surrounding the proposed plans to transition from the United States dollar to a ZiG mono-currency.
RBZ governor John Mushayavanhu moved to calm fears within the business sector, saying the shift to a domestic currency is the cornerstone of lasting financial stability.
Government introduced the ZiG in April 2024 in one of the many currency experiments since the country dollarised the economy at the height of record-breaking hyper-inflation in 2008.
Authorities have proposed pursuing a mono-currency system by establishing the ZiG as the primary legal tender to end years of reliance on the dollar as the currency of trade.
The move has spooked some circles that are still haunted by the country’s long running currency crisis, but Mushayavanhu, represented by deputy governor Innocent Matshe, at a 2025 Economic Review and 2026 Outlook meeting held in Bulawayo, said there was nothing to fear.
Mushayavanhu argued that the ZiG is sustaining positive real interest rates, which he described as vital for preserving value and stimulating investment growth.
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“You are safer saving in ZiG than in USD,” he asserted.
“Single-digit inflation means a return to enduring stability. Month-on-month ZiG inflation averaged around 0,3% since February 2025, reflecting enduring price stability.”
“Annual ZiG inflation declined from a peak of 95,8% in July 2025 to 4,1% in January 2026 and the Reserve Bank will continue implementing prudent monetary policies to sustain this trajectory.”
Addressing concerns about the security of foreign currency holdings, Mushayavanhu indicated that the stabilisation process does not mean the banking public will lose their US dollar deposits.
“They will keep them and still make use of them,” he maintained.
He noted that the foundation for the ZiG’s stability is strengthening, revealing that foreign currency reserves have climbed to US$1,2 billion by December 2025.
This level is sufficient to cover about six times the stock of ZiG reserve money and roughly double ZiG deposits.
“The build-up of foreign currency reserves is critical for the lasting stability of ZiG,” Matshe said.
He highlighted a 21,8% increase in the country’s foreign currency generation capacity, which reached US$16,2 billion in 2025, up from US$13,3 billion in 2024.
“Export earnings dominated the basket… averaging 59,7% of total foreign currency receipts in 2025, followed by loan proceeds at 14,8% and diaspora remittances at 13,5%.”
The central bank governor projected further growth in 2026, citing improved prices for key export minerals and rising remittances.
The ZiG exchange rate has remained stable against the US dollar, averaging 26,61.
The parallel market premium was contained below 20% for most of the year, aided by foreign exchange market interventions totalling US$1,34 billion since April 2024, according to RBZ.
Government said the ZiG was backed by gold and a basket of other precious minerals upon its introduction in 2024.
ZiG was meant to replace the Zimdollar that had severely lost value after being battered by inflation.
The local currency had been re-introduced in 2019 after President Emmerson Mnangagwa began the de-dollarisation drive.
Economic analyst Gift Mugano, who is also the executive director of Africa Economic Development Strategies, noted the benefit of the surging gold prices.
“Gold traditionally constitutes 53% of mineral exports and 48% of total exports,” Mugano said.
“The surge in gold prices has immense benefits for Zimbabwe in terms of increased export revenue, which will dilute potential loss from declining prices of base metals like platinum and nickel.”