Zimbabwe is one of Africa’s most richly endowed gold producers. Year after year, gold accounts for the country’s largest share of mineral exports and a substantial portion of foreign currency earnings.
Yet despite this natural advantage, the economy continues to struggle with foreign exchange shortages, currency instability, and limited long-term investment. This contradiction raises a fundamental question: how can a country so rich in gold remain so constrained financially?
Part of the answer lies not in how much gold Zimbabwe produces, but in how that gold is monetised. At present, gold largely exits the economy as a physical commodity, sold into external markets with limited integration into domestic financial systems. The missing link is the country’s capital markets—specifically the Zimbabwe Stock Exchange (ZSE) and the Victoria Falls Stock Exchange (VFEX). Properly utilised, these exchanges could transform gold from a mined resource into a powerful financial asset.
Where Value Is Lost in the Current Gold System
Zimbabwe’s gold value chain is dominated by physical extraction and export. Large-scale miners, small-scale operators, and artisanal miners sell gold mainly through centralised buyers or informal channels. While this ensures immediate liquidity, it limits broader economic impact.
Several challenges arise from this structure. First, price discovery is weak. Gold prices are largely determined externally, leaving producers and the economy vulnerable to under-pricing and opaque transactions. Second, value leakage is significant, with smuggling and informal trade depriving the country of export earnings and tax revenue. Third, gold rarely circulates within domestic financial markets, meaning pensions, insurance funds, and ordinary savers have little opportunity to invest directly in the country’s most valuable resource.
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In effect, Zimbabwe exports gold but imports financial value. The economy benefits from export receipts, but misses out on deeper capital formation, investment diversification, and long-term stability.
What It Really Means to Monetise Gold
Monetising gold does not simply mean mining more or exporting faster. True monetisation occurs when gold becomes a financial instrument, capable of being traded, invested in, and leveraged within the economy. In many countries, gold is embedded into capital markets through gold exchange-traded funds [ETFs], gold-backed bonds, shares of gold producers, and other structured instruments.
These mechanisms allow gold to attract both domestic and foreign capital, deepen financial markets, and serve as a hedge against inflation and currency risk. For Zimbabwe, this shift would mean moving gold from vaults and export consignments into transparent, regulated, and liquid markets. This is where the ZSE and VFEX become crucial.
Why Local Stock Exchanges Matter
Stock exchanges exist to mobilise savings, allocate capital efficiently, and provide price discovery. When natural resources bypass these markets, a critical development opportunity is lost. The ZSE, operating primarily in local currency, is well-positioned to channel domestic savings into gold-linked investments.
Pension funds, asset managers, and retail investors could gain exposure to gold without physically holding it. This would not only protect savings against inflation, but also anchor domestic wealth to a real, productive asset. The VFEX, on the other hand, operates in foreign currency and is designed to attract offshore capital.
By listing gold-linked instruments on the VFEX, Zimbabwe could present its gold sector directly to international investors, without forcing them to navigate external commodity exchanges. This would improve visibility, credibility, and competitiveness. Together, the two exchanges offer a dual platform: one for domestic financial deepening, the other for global capital integration.
The Case for Gold Trading on the ZSE
Listing gold-related instruments on the ZSE would have several important benefits. First, it would strengthen local participation in the gold economy. Currently, most Zimbabweans engage with gold only as labourers, miners, or informal traders. Exchange-based instruments would allow them to participate as investors.
Second, the ZSE could support the development of gold-backed securities, such as gold ETFs or bonds linked to gold production. These instruments would provide a store of value in an inflation-prone environment, improving confidence in long-term savings.
Third, formal market participation could encourage the formalisation of artisanal and small-scale miners, who produce a large share of Zimbabwe’s gold. If their output were linked to exchange-traded instruments, transparency and compliance would improve, reducing smuggling and enhancing revenue collection.
In this way, the ZSE would not only trade gold—it would integrate gold into the broader financial and social fabric of the economy.
The Strategic Role of the VFEX
While the ZSE anchors domestic participation, the VFEX is strategically positioned to monetise gold internationally. As a foreign-currency-denominated exchange, it reduces currency risk for global investors and aligns naturally with gold’s status as a global reserve asset.
Gold-linked listings on the VFEX could include shares of gold mining companies, gold-backed notes, or structured products aimed at institutional investors. Such instruments would allow Zimbabwe to capture more value per ounce, rather than relying solely on export volumes.
Importantly, the VFEX could help reposition Zimbabwe as a credible gold investment destination, not just a supplier of raw bullion. This would diversify capital inflows, reduce reliance on debt, and strengthen foreign currency reserves.
Macroeconomic Benefits of Exchange-Traded Gold
Integrating gold into local stock exchanges would have far-reaching macroeconomic effects. Increased transparency and formalisation would reduce illicit financial flows and smuggling. Improved foreign currency inflows would support balance-of-payments stability.
Moreover, gold-traded instruments could enhance monetary credibility. When domestic savings are anchored to gold-linked assets, confidence in the financial system improves. This can ease pressure on the exchange rate and reduce speculative behaviour. Over time, deeper capital markets also support broader economic growth by lowering the cost of capital, encouraging long-term investment, and improving fiscal revenues.
Policy and Regulatory Enablers
For this vision to succeed, policy coherence is essential. Mining regulations, exchange control rules, and capital market frameworks must align. Investors—both local and foreign—require confidence in custody arrangements, settlement systems, and regulatory independence.
Coordination between the Ministry of Finance, the Reserve Bank of Zimbabwe, Mining Authorities, and Exchange Regulators will be critical. Transparency, consistency, and rule-based governance must underpin any gold-trading initiative.
Risks and How to Manage Them
There are legitimate concerns. Gold prices are volatile, market depth may initially be limited, and trust in institutions takes time to build.
However, these risks are manageable through phased implementation, strong regulation, and learning from other gold-producing economies that have successfully integrated gold into their capital markets.
The greater risk lies in maintaining the status quo—continuing to mine and export gold without building lasting financial value at home.
Turning Gold into Development Capital
Zimbabwe’s gold is more than a mineral; it is a strategic national asset. But without integration into capital markets, its economic impact will remain limited.
Trading gold through the ZSE and VFEX is not a cosmetic reform—it is a structural shift in how the country converts natural wealth into financial strength.
By monetising gold through local stock exchanges, Zimbabwe can retain value, attract investment, stabilise the economy, and give its citizens a direct stake in their most important resource. The gold is already there. The missing link is the market.
Dr J. Mundonde is a Post-Doctoral Research Fellow at the University of South Africa, Department of Finance Risk management and Banking. He can be contacted on justice.mundonde@gmail.com