Online Reporter
Business Reporter
THE Government has once again ruled out compelling holders of foreign currency to convert their money into local currency when Zimbabwe transitions to a mono-currency regime, with two senior officials yesterday reinforcing the point authorities have made countless times.
The reassurances were delivered during the signing of a US$30 million facility between CABS and British International Investment (BII), the UK’s development finance institution — an occasion officials used to address what one described as the single biggest concern for investors.
Reserve Bank of Zimbabwe (RBZ) Dr Mushayavanhu told guests attending the signing ceremony in Harare yesterday that the transition would be market-driven and would only occur after eight preconditions are met.
The conditions include low and stable inflation, three to six months’ import cover, exchange rate stability, strong demand for ZiG currency, financial sector stability, policy cohesion, a secure national payment system and an efficient foreign currency market.
“I want to assure you that, number one, the return to mono-currency is going to be market-driven. By market-driven, I am saying that we want to get to a point where, when someone is paying for an obligation, the recipient of that money should be able to say, pay me whatever you have.
“If you have dollars, pay me in dollars. If you have ZiG, pay me in ZiG. And we are slowly getting there,” he said.
“If you go to the retail sector at the moment, you will not have to negotiate with the till operator to say, ‘ Please, can I pay in ZiG. The till operator will ask you, ‘Are you paying in US dollars or ZiG?”
He added: “We have come up with eight conditions. We will not even attempt to talk about mono-currency until and unless those conditions are addressed.”
Dr Mushayavanhu described the CABS/BII loan facility as a historical development in the financial services sector, saying it signalled that Zimbabwe is open for business.
“From where we sit, it is a historical development in the financial services sector, because it signals that Zimbabwe is open for business,” he said.
“The fact that BII has come in, we have seen other financiers who were sitting on the periphery also saying, what is it that BII is seeing in Zimbabwe that we have not seen? And we have seen that they have also started coming in.”
He said the investment was coming at a time when fiscal and monetary authorities had stabilised the exchange rate, noting that for two years since September 2024, the rate had remained stable.
“We have stabilised the exchange rate, I think, for the first time. We have gone for a period of two years, from September 2024; now we are in September 2026. The rate has been very stable,” Dr Mushayavanhu said.
He said inflation expectations have since been anchored with single-digit inflation recorded from January this year.
“And for the first time in January this year, we started recording single-digit inflation. We have maintained that single-digit inflation up until now,” he said.
The central bank chief said the Government had abolished the foreign currency auction system and holders could now access foreign exchange directly from their banks.
“Now, if you want forex, you go to a bank and you will be able to get foreign exchange from your bank,” he said.
“I have on most occasions challenged corporates to say, if there is anyone who is going to their bank and failing to get forex, please come to the Reserve Bank and we will deal with that bank. And no one has shown up to say they have not been able to access forex.”
He said Zimbabwe is now a strong generator of foreign currency, with inflows exceeding US$10 billion in the first half of the year, while maintaining a current account surplus and trade surpluses.
“So there is absolutely no reason why anyone should say they have not been able to get foreign currency in this country,” he said.
He added that the Reserve Bank had been accumulating reserves, from less than one week of import cover two and a half years ago to two months of import cover as of this week.
“Two years ago, this country had less than one week’s worth of import cover in foreign reserves at the Reserve Bank. As we speak right now, as of yesterday, we were at two months’ import cover,” he said, noting that the Southern African Development Community benchmark is three to six months.
Permanent Secretary in the Ministry of Finance, Economic Development and Investment Promotion, Mr George Guvamatanga, assured banks not to panic over the conversion to mono-currency.
He said all financial obligations would be honoured in the currency in which agreements were originally signed.
“That is the Government position,” Mr Guvamatanga said.
Mr Guvamatanga said only one element of the current arrangement would change. Local transactions would be conducted in local currency, while offshore transactions could continue in foreign currency and account holders would retain their balances.
“If you then decide to transact locally, you have to convert into the local currency. But everything else will remain the same,” he said.
He said foreign currency accounts are not a new phenomenon, noting that they had existed alongside the local currency for exporters and individuals, and were previously known as free funds.
The public reassurance from two of the country’s most senior economic officials, at an event ostensibly about development finance, points to the sensitivity of the currency question among depositors and investors.
Mr Guvamatanga said he was honoured to witness the formalisation of the US$30 million partnership, which he said reflects confidence in Zimbabwe as an investment destination, progress in economic reforms and the potential of productive sectors.
“This transaction reflects confidence in Zimbabwe as an investment destination, the progress of our economic reforms and, above all, the potential of our productive sectors,” he said.
He said BII’s return after a 13-year absence reflects the Government’s progress in re-engaging the international community, noting that it followed the European Investment Bank’s return a few years ago after a 22-year absence — when CABS was also the first recipient.
“BII’s return after a 13-year absence reflects the Government of Zimbabwe’s progress in re-engaging the international community. My Ministry welcomes this investment, which follows the European Investment Bank’s return a few years ago after a 22-year absence — when CABS was also the first recipient,” Mr Guvamatanga said.
He said the Ministry recognises the strengthening relationship between the Governments of Zimbabwe and the United Kingdom, and that the transaction aligns closely with the national objective of sustained, inclusive and private-sector-led growth.
“Our responsibility is to maintain a stable, predictable policy environment; strengthen public finances; improve the ease of doing business; and channel investment into sectors that create jobs, deepen value chains and generate exports,” he said.
Mr Guvamatanga said Zimbabwe had faced a challenging global environment marked by geopolitical conflict, supply-chain disruptions, rising fuel and fertiliser costs, tighter financial conditions and disease outbreaks affecting tourism and trade. However, the economy has remained resilient, supported by strong revenue performance, currency and exchange-rate stability, lower inflation, higher mineral commodity prices, a favourable agricultural season and ease-of-doing-business reforms.
He said annual headline inflation fell to 4.1 percent in January 2026, bringing local currency inflation into single digits for the first time in more than three decades, with inflation at 2.9 percent in August and 3,7 percent in September.
The economy is projected to grow by approximately 5 percent in 2026, supported by mining, agriculture, improved electricity supply, investment, mineral beneficiation and value addition, having grown by 8,3 percent in 2025.
He said the Government has approved reforms across 12 sectors, including the rationalisation of fees, licences and permits, and commended the Reserve Bank for implementing monetary policy measures that reinforce stability and responsible liquidity management.
On re-engagement, Mr Guvamatanga cited Zimbabwe’s election as a non-permanent member of the United Nations Security Council for 2027–2028, its removal from the World Bank Group’s list of fragile and conflict-affected economies in July 2026, successful completion of the first phase of the IMF Staff-Monitored Programme, progress to the second phase and a Citigroup economic note in August 2026 identifying Zimbabwe as a country to watch.
On currency, he reiterated: “Let me reassure the British International Investment PLC and other international funders that the Government of Zimbabwe is committed to a credible, orderly and market-driven transition to a mono-currency system, underpinned by confidence, sound economic fundamentals and lasting macroeconomic stability.”
The facility signed with BII will allow CABS to provide affordable long-term trade finance and capital expenditure loans to small and medium-sized enterprises, and to support export-focused customers in agriculture and food manufacturing seeking to replace machinery and expand capacity.
A third strand will direct resources towards clean energy and sustainable agriculture. CABS has provided about US$100 million to the agricultural sector as at 30 June 2026.
Maria Smith, Chief Investment Officer at BII, said Zimbabwe is the kind of market where development finance can have the greatest impact, citing strong entrepreneurial talent and growth potential alongside persistent constraints on access to finance.
The facility forms part of BII’s newly launched Zimbabwe Agricultural Finance Programme.
Beneficiaries of the facility were encouraged to use it to increase output, ensure food and nutrition security and generate export revenue. They were also urged to adopt sustainable production methods ahead of expected El Niño conditions.
