Ray Bande
Senior Reporter
THE country’s transition to mono currency from the current multi-currency system will not be legislated, but the move will be market-led and anchored on sustained macro-economic stability, Permanent Secretary in the Ministry of Finance, Mr George Guvamatanga, has said.
Zimbabwe has moved closer to adopting the Zimbabwe Gold (ZiG) as its sole currency after the Reserve Bank of Zimbabwe (RBZ)’s conditions-precedent score improved to 54,9 percent in September from 50,1 percent in August.
The improvement was driven mainly by increased foreign currency reserves and relatively subdued inflation, with the country’s reserves rising to US$1,9 billion by the end of September, and expected to surpass US$4 billion by end of next year.
Speaking during the Office of the President and Cabinet strategic workshop in Mutare yesterday (Thursday), Mr Guvamatanga said there are conditions to be met before the country moves away from the current multi-currency system into a mono currency system.
Mr Guvamatanga’s presentation, which was titled: Enhancing public resource mobilisation and management to accelerate NDS 2: Implementation through fiscal discipline, efficient resource allocation and value for money, also noted that receiving and owning the foreign currency in a bank account will remain legal, but only local currency will be used in domestic transactions.
“The domestic economy continues to grow, with cumulative growth of 33,6 percent in 2025, significantly above the SADC average in average of 30 percent.
“This demonstrates that our economy is growing, transforming, resilient and the macroeconomic stability is crucial. While I am there, let me address the issue of multi-currency and mono currency.
“The Reserve Bank of Zimbabwe has said there will not be a legislated transition from multi-currency into mono currency. In fact, they have come back and said, there are conditions to be met before we move away from the current multi-currency system into a mono currency system.
“According to them, they have indicated a stable exchange rate, which I think we have achieved, but still requires further entrenchment. They have also indicated a low inflation rate. But the key element of the condition that it takes is on imports and exports.
“What will inform the transition to a mono currency is the market, ultimately. The idea is that, as all of us here, we should create an environment where it becomes indifferent on whether you are using the US or whether you are using the local currency.
“We are not saying you will not be allowed to receive or own US dollars, but you will no longer have to buy tomatoes, bread and groceries in US dollar. If you have US dollars in your foreign currency account, you will have to change it at the bank and then use the local currency for domestic transactions,” said Mr Guvamatanga.
The Central Bank has identified eight conditions that must be met before Zimbabwe can sustainably transition from the current multi-currency system to the sole use of the ZiG.
These include durable macroeconomic stability with single-digit inflation, adequate foreign currency and gold reserves of at least three to six months of import cover, stable exchange rate dynamics, an efficient foreign exchange management system, increased demand and acceptance for the local currency (ZiG), financial sector stability, an efficient National Payments System, as we as a fiscal and monetary policy cohesion, strictly prohibiting central bank financing (monetisation) of budget deficits.
According to updates from the RBZ, Zimbabwe has achieved six of these eight conditions, while the remaining work focuses heavily on scaling up import cover reserves and broadening domestic transactional demand.
This is the reason why RBZ Governor, Dr John Mushayavanhu, declared that the country’s return to a mono-currency system is no longer about setting a date, but meeting economic conditions.
Mono currency transition will not be legislated: Guvamatanga
