Zimbabwe’s gold-backed currency the ZiG has lost nearly 50% of its value just six months after its introduction. Launched in April 2023 to reduce reliance on the US dollar, the ZiG has since been devalued by over 40%, following a sharp disparity between official and black market exchange rates. The currency was meant to stabilize Zimbabwe’s economy, which has long been plagued by hyperinflation and reliance on foreign currency. However, many Zimbabweans continue to rely on the US dollar for transactions, despite the government’s efforts. The devaluation reflects broader public mistrust and the government’s ongoing struggle to establish the ZiG as a viable local currency. While authorities remain optimistic about the ZiG’s future, experts warn that significant work is needed to restore public confidence in the currency.

The future of Zimbabwe’s gold-backed currency hinges on several factors

Restoring Trust: For the currency to regain value, the government must work to rebuild trust among its citizens. This involves transparent governance, accountability, and consistent monetary policy that demonstrates a commitment to stability.

Economic Reforms: Structural economic reforms are essential to address the underlying issues contributing to instability. This includes measures to improve fiscal discipline, attract foreign investment, and stimulate economic growth. Enhancing the overall business environment will be crucial for restoring confidence.

Diversification of Currency Use: Zimbabwe may need to explore ways to integrate the gold-backed currency into a broader currency system. This could involve encouraging transactions in the gold-backed currency alongside other stable currencies, creating a more robust and diverse economic landscape.

Engagement with International Markets: Re-establishing relationships with international markets and investors can provide the necessary support for economic recovery. Engaging with global financial institutions for guidance and assistance can also aid in stabilizing the currency and the economy.

Monitoring and Adjustment: Ongoing assessment of the gold-backed currency’s performance will be critical. The government should be prepared to make necessary adjustments based on market conditions, ensuring that the currency remains viable and competitive.

The following survey reports are available

• • Sectorial-Based Salary Survey Reports
  • National Salary Survey Report (Consolidation of 13 Sectors)
  • Non-executive Directors Fees Survey Report
  • Human Resource Policy Documents