Zimbabwe commits to annual independent audits of its gold reserves underpinning new ZiG currency

By bne IntelliNews April 25, 2024

Zimbabwe's government will ensure its gold reserves which underpin its newly-introduced currency, would be independently audited once yearly, The Herald reports.

The southern African nation introduced the Zimbabwe Gold (ZiG) unit on April 8 to replace the inflation-ridden Zimbabwe dollar. The ZiG is backed by 2.5 tonnes of gold reserves and about $80mn in foreign currency.

Speaking before a joint sitting of the parliamentary portfolio committees on finance and industry, the daily wrote on April 25, the central bank chief said the ZiG in circulation will "always" match increases in gold and cash reserves.

“Any increase in money supply will be met by a concomitant increase in reserves and will also be linked to productivity, inflation and other variables and I can assure the public that we will stick to that,” said John Mushayavanhu, governor of the Reserve Bank of Zimbabwe (RBZ).

Authorities, he added, are negotiating with fuel retailers so a formula can be agreed upon for the sale of the product in the new currency instead of the current situation under which it is being sold in the greenback only.

“We are still negotiating and making considerations on how best we can allow the sale of fuel in ZiG,” Mushayavanhu said.

“We started on taxes and included other commodities and people are going to be advised.  We need to do our work gradually and we are going to reach that (point) where fuel is sold in ZiG.  For a country to grow, you need to transact in your local currency, and we are starting at 15% and we expect to grow that to 30, 40, 50% or even higher by 2026.”

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