The Reserve Bank of Zimbabwe (RBZ) has decoupled its monocurrency transition plan from a fixed timeline, shifting instead to a conditions-based approach under which the switch will only occur once strict benchmarks are met.
The move comes as financial institutions begin taking defensive positions, with banks no longer extending loans tied to the previously proposed 2030 monocurrency deadline.
Meanwhile, both the market and consumers are increasingly holding foreign currency outside formal channels, tightening liquidity in an economy already starved of hard currency.
By moving from a fixed calendar to a condition-based timeline, Zimbabwe’s central bank is signalling a cautious but flexible path toward monocurrency, prioritising economic stability and foreign reserve targets over arbitrary deadlines.
The conditions-based approach was outlined during discussions last Friday with the International Monetary Fund (IMF) and Treasury officials.
RBZ governor John Mushayavanhu emphasised that the central bank will only move to monocurrency once specific “conditions precedent” are met, including maintaining three to six months of import cover.
“Currently, we are sitting at about 1,5 months. We are not there yet, but we are making progress towards getting there,” he said. “Once we get there, we will take that out there and say, this is step number one; that is the next. We also say we want to see continuous stability, zero-digit inflation.
“We achieved zero-digit inflation in January, and we want to sustain it. I think we have one of the things that they (IMF) are hoping will happen during the SMP [Staff Monitored Programme] period, that is, sustained stability, sustained single currency, and single-digit inflation.”
- Village Rhapsody: How Zimbabwe can improve governance
- Defaulting Zim in bid to pacify Paris Club . . .US$420.4m black hole exposed
- Fidelity loans, IMF windfall to give Zim mines a big lift
- I am not scared: AfDb chief shrugs off Africa food crisis
Keep Reading
A six-month import cover translates to US$4,69 billion, using the trade data from last year.
“We have also said we want to increase demand for ZiG. I think we have addressed that issue. And several other conditions precedent that we have said to be invested before we can go to monocurrency,” Mushayavanhu said.
“So, the way is very clear. If we haven’t achieved those conditions precedent, we will not be able to go into monocurrency. But if we can achieve them sooner, we will also be able to go into monocurrency sooner than any date that may have been announced.”
The IMF’s mission chief for Zimbabwe, Wojciech Maliszewski, stressed that the SMP will focus on preserving macroeconomic stability, improving the functioning of the foreign exchange market, and coordinating central bank and fiscal measures.
“The focus for now will be to make sure that the recent gains in stabilisation will be sustained, particularly through the monetary policy stance and a substantial improvement in the functioning of the foreign exchange market,” he said.
Maliszewski emphasised that effective coordination between the central bank and fiscal authorities is central to the programme’s success, adding that fiscal discipline, alongside structural reforms, is critical in creating a stable foundation for investment.
Finance, Economic Development, and Investment Promotion secretary, George Guvamatanga, cautioned that challenges such as ZiG’s current inability to buy fuel should not be seen as a reflection of the currency’s long-term viability, noting that electronic usage has risen.
