HARARE – Kenyan President William Ruto praised Zimbabwe’s gold-backed currency, ZiG, as a potential catalyst for economic recovery in the southern African nation.
Speaking at an international trade fair in Bulawayo, Ruto said the introduction of ZiG is a testament to the government’s determination to revive the country’s economy despite various challenges and pressures, Bloomberg reported.
Said Ruto; “This radical revitalisation of Zimbabwe’s monetary policy will contribute greatly to the country’s economic resurgence.”
Zimbabwe’s untapped substantial reserves of copper and lithium as well as gold, platinum, silver and other precious metals represent tremendous wealth, Ruto said. “It is appropriate that they should be deployed to back the national currency.”
ZiG, the new gold-backed currency, which stands for “Zimbabwe Gold” was launched earlier this month to help stabilise the economy and protect citizens from currency fluctuations and sky-high inflation.
Zimbabwe’s gold deposits have played a huge role in the country’s economy, as the precious metal accounted for nearly 25 per cent of the nation’s total exports in January 2024.
However, experts have questioned whether Zimbabwe has enough reserves to adequately back the currency and if the latter could suffer from volatility in gold prices.
Zimbabwe’s Central Bank governor said that the country will refrain from printing additional ZiG notes unless it has the reserves to support the new currency.
Earlier this week, Zimbabwe’s vice president Constantino Chiwenga said that the ZiG is a step toward abandoning the use of US dollars in the economy. Dollars are legal tender until 2030.
The newly introduced ZiG banknotes will be available in denominations of 1, 2, 5, 10, 50, 100, and 200.
