‘You can buy fuel with ZiG’

The Zimbabwe Gold (ZiG) currency is gaining traction as a store of value, with some fuel dealers now accepting it for payments, even as authorities work to increase the circulation of banknotes, particularly in the southern region where the US dollar and South African rand have traditionally been preferred.

Reserve Bank of Zimbabwe (RBZ) Governor, Dr John Mushayavanhu, revealed this yesterday in Bulawayo while responding to questions from stakeholders who attended his engagement on the recently issued 2026 Monetary Policy Statement.

Dr Mushayavhanu acknowledged the public anxiety over the perceived exclusive use of forex when buying fuel, and the concern over inadequate circulation of ZiG notes in Bulawayo, Matabeleland North and Matabeleland South provinces.

Due to the proximity to South Africa, most cities and communities in the Southern region prefer using the rand and the United States dollar for daily transactions, more so in informal transactions, with the ZiG mainly used in formal electronic transactions.

“The first question was on the rand being dominant in this region, which we understand because we are in a multi-currency regime and the proximity to South Africa would mean that there is more rand circulating in this region than elsewhere,” said Dr Mushayavhanu.

“This is why we are now here promoting the use of ZiG. We have seen that in electronic transactions, there is a plus or minus 40 percent. It’s happening even in supermarkets in Bulawayo, where the transactions are almost 40 percent local currency and 60 percent other currencies.

“In fact, in some bigger supermarkets we have actually seen the ratio getting closer to 50 percent,” the Governor added.

“So, we have a ZiG that has been stable for the past one and a half years and that stability should also encourage people to now see that there is value. ZiG can also be used as a store of value rather than just as a transacting currency. It’s a journey that we are travelling. We are aware of the situation in the southern region and we are addressing it.”

Dr Mushayavhanu said the Central Bank had people who were traversing the whole region to try and get acceptability and buy-in for ZiG. The Bulawayo business community and stakeholders further pressed the RBZ to clarify the issue of fuel sales and when it will be sold in the local currency.

“Will ZiG purchase fuel? The answer is yes. In fact, currently ZiG is actually purchasing fuel in some instances,” said Dr Mushayavhanu.

“Let me explain how the Government has said 50 percent of taxes should be paid in ZiG. Now, if you are a fuel dealer and you are selling oil in US dollars, when the day comes for you to pay tax, you have to find the ZiG.

“Some of the dealers have said, no problem, I will go to my bank and sell dollars and get ZiG. Yes, you can do that, but the bankers that are here will tell you that when you are selling currency, the bank buys it from you at the buying rate,” he explained.

“That buying rate is currently about ZiG25. So, you are actually losing out; you would be better off if you were selling some of your fuel in ZiG, at an exchange rate of your choice.”

The RBZ Governor said this, citing the repealed Statutory Instrument (SI) 81A of 2024, which fixed the exchange rate at which traders can trade.

He further stated that fuel dealers could sell their product for US$1 or ZiG30, for instance, and be able to raise enough money to pay taxes.

“We have seen certain fuel dealers selling fuel in bulk in ZiG; maybe they don’t want to do it in the pump station.

So, they will say, if you want, I can give you 60 000 litres and I want that in ZIG and it’s happening,” said Dr Mushayavhanu.

“But as we go, as we entrench the use of ZiG in the market, we are going to see a lot more of that happening. You will even see, maybe some dealers selling fuel in ZiG, so it is coming, be patient.”

This comes at a time when the country is in a transitional phase, operating under a multi-currency system, while actively pursuing a roadmap to return to a mono-currency system by 2030.

“The transition to the exclusive use of ZiG for settling all domestic transactions will be a gradual process anchored on macro-economic stability as enunciated in the National Development Strategy 2 (NDS2).

“As such, the transition is not date-based but is dependent on the achievement of the conditions precedent,” said Dr Mushayavhanu.

These include Nano loans, which represent very small digital loans extended by mobile money providers to their clients with minimal paperwork and no collateral requirements, designed to provide quick access to cash for individuals without access to formal banking credit.

Also covered is durable macro-economic stability characterised by low and stable inflation at single-digit levels and adequate foreign currency reserves of at least three to six months of imports cover, in the medium to long-term, said the Governor.

Dr Mushayavanhu said an efficient foreign exchange management system that eliminates foreign exchange market segmentation and promotes ease of access to foreign currency by importers and for other bona fide requirements was also key, alongside stable exchange rate dynamics, with minimum over- or undervaluation of the ZiG, among other factors.

“Under mono-currency, domestic products and services will be exclusively paid for and settled in local currency, while foreign currency will be reserved for external payments.

“The RBZ assures the public that financial assets and contracts denominated in foreign currency will be safeguarded and preserved. Accordingly, the adoption of mono-currency will not eliminate foreign currency accounts, foreign currency-denominated pension fund holdings, or US dollar-based equities, including those on the Victoria Falls Stock Exchange (VFEX) and Treasury Bills,” said Dr Mushayavhanu.

He added that foreign currency loans and advances made to domestic individuals and non-exporting corporates shall remain denominated in foreign currency.
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