Source: Beyond scepticism: ZiG’s unprecedented success story – herald
Gibson Mhaka
Zimpapers Politics Hub
WHILE global attention often centres on major currencies like the US dollar, Euro or British pound sterling, Africa’s currency landscape in 2025 is reflecting both resilience and diversity across the continent.
Several African currencies are maintaining strong value due to stable macroeconomic policies, significant trade inflows and resource-backed reserves.
Not to be outdone, Zimbabwe’s gold-backed currency, the Zimbabwe Gold, has held its ground, completing its longest period of stability since its launch in April.
This achievement casts aside the memory of Zimbabwe’s past, when hyperinflation at 208 million percent in July 2008 wiped out local currency savings.
The ZiG’s resilience reflects a broader trend of stability and diversity across the African continent, where several local currencies are maintaining strong value due to stable macroeconomic policies, significant trade inflows, and resource-backed reserves.
The introduction of the ZiG was a proactive measure to address past economic challenges, demonstrating the Government’s resolve to create a conducive environment for economic growth and investment.
Zimbabwe had not experienced any prolonged currency stability between February 2019, when the local unit was reintroduced, and April 2024, when the ZiG was launched.
The Zimbabwe dollar had experienced significant devaluation and depreciation since its relaunch in 2019, following a hyperinflation-induced 10-year hiatus, leading to reduced confidence and a widespread reliance on the US dollar for transactions.
But the picture has changed. Monthly inflation in Zimbabwe has been mostly declining since February 2025, a direct result of sustained tight monetary and fiscal policies and the stability of the ZiG.
For the ordinary Zimbabwean, whose incomes were often eroded by persistent currency swings, the positive impact of the more stable ZiG is already being felt through prolonged price stability for basic goods and public transport fares.
Analysts and business leaders say the steady exchange rate has started to reduce inflationary pressures and encourage transactions in the local currency, dissipating scepticism over whether the stability would last.
Ms Gladys Shumbambiri-Mutsopotsi, an economist, noted that predictable exchange rates make it easier for people to plan purchases and avoid panic buying.
“Stability reduces the need for traders to charge extra to cover risks, and that helps to protect household budgets,” she said.
She added that prolonged stability gives authorities leverage to anchor expectations, a crucial step in breaking the cycle of inflationary fears that has haunted the economy since the hyperinflation of 2008.
The business community, long constrained by unpredictable exchange rates and a shortage of working capital, says the calmer environment is giving firms room to plan.
Dr Nxaba Ndiweni, an industrialist, said local manufacturers were beginning to benefit from being able to price in the local currency without fearing sudden losses.
“The stability we are seeing now is a lifeline,” he said.
“When companies can rely on a currency that holds its value, they are more willing to commit to production and investment.”
Importers also report a reduced reliance on holding scarce US dollars for day-to-day operations, cutting transaction costs.
Some firms are even shifting procurement to local suppliers, encouraged by steadier pricing. Economic analyst Namatai Maeresera, described the recent moderation in producer prices as encouraging, but warned that fiscal discipline would be key.
“Annual inflation remains high by global standards,” he noted.
“If the Government avoids monetary slippage and keeps reserves intact, confidence will continue to build.”
He added that positive sentiment could shift Zimbabwe out of the high-risk category, helping to attract capital and restore credit lines.
The positive reception of the ZiG by both economic agents and the general public further underscores its success.
The Reserve Bank of Zimbabwe has reported that the ZiG’s introduction has simplified monetary transactions and enhanced the predictability of financial affairs, which are critical for economic recovery and growth.
Businesses and consumers have embraced the new currency, which circulates alongside foreign currencies under a multi-currency system.
This acceptance is a testament to the currency’s credibility and the Government’s effective communication strategy, which has helped build trust in the ZiG’s value and stability.
Concrete examples of the ZiG’s impact are evident in the agricultural sector, where a stable currency and predictable pricing have allowed for better planning and investment.
Farmers now have greater confidence in the market prices for their produce, which helps them in securing loans and investing in better farming techniques.
The stability brought by the ZiG has also positively affected the retail and manufacturing sectors, with businesses reporting increased consistency in pricing and a reduced need for frequent price adjustments due to currency fluctuations.
Zimbabwe’s decision to introduce the ZiG, alongside the use of foreign currency, was a deliberate strategy to manage exchange rates effectively, while ensuring the country has a strong local currency that can facilitate economic transactions and bolster confidence in the domestic economy.
Despite the Government’s clear directive, some businesses across the country have tried to defy the directive to accept the local currency.
They either refuse to use it or manipulate exchange rates based on the black market, leading to significant distortions in the economy.
This was not merely a technical violation of policy; it had real-world consequences that reached far beyond the transactions of a few businesses.
“The potential benefits are very real,” Ms Shumbambiri-Mutsopotsi said.
“As inflation comes down and interest rates ease, people will have more disposable income, and that feeds back into stronger economic activity.”
For workers whose wages have been eroded by volatility in the exchange rate, the real test will be purchasing power.
Zimbabwe’s journey toward achieving Vision 2030 depends heavily on its ability to achieve monetary stability.
The Government and businesses alike must work together to ensure that the country’s financial system is not just stable, but also inclusive and supportive of development.
To achieve this, we must prioritise local economic growth, stabilise exchange rates and invest in the infrastructure that will support long-term economic development.
In doing so, we will build a strong, self-sufficient economy that can withstand global challenges.
As the Government continues to implement supportive policies and frameworks, the ZiG is poised to be a cornerstone of Zimbabwe’s economic future
The ZiG currency’s performance challenges the prevailing narrative of monetary instability that has long plagued the country.
By successfully maintaining a period of prolonged stability, the ZiG has not only provided relief to ordinary Zimbabweans through predictable prices and stable public transport fares, but has also laid the groundwork for renewed confidence in the local economy.
This achievement is a testament to the Government’s commitment to fiscal discipline and strategic monetary policies, proving that a stable local currency is a vital component of sustainable economic development.
This period of stability marks a crucial step toward achieving Vision 2030 and transforming Zimbabwe into an upper-middle-income economy.
The success of the ZiG demonstrates that homegrown, resource-backed solutions can effectively address complex economic challenges.
As the Government continues to implement supportive frameworks and combat speculative activities, the ZiG is poised to be a cornerstone of a more resilient and self-sufficient financial system.
This commitment to monetary reform signals a new era of economic certainty, one that is critical for attracting investment, fostering long-term growth and ultimately improving the quality of life for all Zimbabweans.
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