Zimbabwe Central Bank Adopts Cautious Approach in ZiG Currency Printing
Zimbabwe’s Central Bank governor, John Mushayavanhu, has announced a conservative stance regarding the printing of additional ZiG notes, emphasizing the necessity of adequate reserves to support the new currency.
Addressing delegates at a meeting, Mushayavanhu reiterated the country’s commitment to avoiding overprinting, which could risk the stability of the currency.
He revealed that President’s directive mandates refraining from printing money without sufficient reserves.
The recently introduced Zimbabwe Gold (ZiG) currency is backed by foreign currencies, gold, and other assets, marking the nation’s sixth attempt to establish a robust local currency.
According to Bloomberg, the development of this structured currency involved guidance from the World Bank, a resource initially unfamiliar to Zimbabwean policymakers.
“We sought expertise from the World Bank on the structured currency, benefiting from their insights,” Mushayavanhu stated. Additionally, the central bank engaged local business entities such as the Confederation of Zimbabwe Industries and the Zimbabwe Chamber of Mines for input.
Mushayavanhu outlined the central bank’s strategy to bolster gold reserves by leveraging royalty payments from miners, aiming to increase bullion reserves by approximately 2 tons annually. This approach underscores the country’s commitment to strengthening its currency with tangible assets.
