Vice President Constantino Chiwenga yesterday warned currency speculators and singled out the retail sector, threatening to close supermarkets if they were suspected of sabotaging the new Zimbabwe gold coin (ZiG).
While officially opening the international business conference at the Zimbabwe International Trade Fair (ZITF) in Bulawayo, Chiwenga said ZiG is here to stay.
“ZiG is here to stay forever,” Chiwenga said.
“The new currency will therefore not be subject to exchange rate fluctuations or manipulation by speculators.
“So, speculators are somewhere [wherever you are] We know we are jumping and trying to play in supermarkets [you]. Behave or you will be shut down or we will shut you down [up]. “Two things.”
The government introduced the ZiG to replace the local currency which had severely lost value after being hit by inflation.
The local currency was reintroduced in 2019 after President Emmerson Mnangagwa began his campaign to get rid of the dollar.
Authorities say ZiG is backed by gold and foreign currency reserves as well as other precious metals.
The ZiG coin, which was introduced earlier this month, is currently trading at around 17 ZiG to one US dollar on the parallel market, although the government’s official exchange rate is 13 ZiG to the US dollar.
“ZiG is expected to provide a permanent solution to inflation expectations, which is critical for price sustainability and exchange rate stability in the economy,” Chiwenga said.
“Given these limitless benefits, I call on the public and the private sector, including households, workers, businesses, civil society and the international community, to fully embrace and support ZiG.”
Chiwenga also threatened gold smugglers, declaring that not a gram of gold would leave the country unaccounted for, saying the metal was needed to back the new currency.
“We will put in place measures, strict measures, that will make heads roll,” he said.
“Every gram should be counted in our gold. We need our gold and because it was given to us by God. No one brought gold to Zimbabwe, but it is in our soil.
“If we don’t want to mine it, it will stay there, but no one should touch it. So, all our money that we are talking about here, Zimbabwe gold, will be firmly entrenched, through our gold and our gold, we get from all our resources.
Previous reports have linked gold dealers and smugglers to the ruling ZANU-PF party, which denies the allegations.
In November, Henrietta Rushwaya, a relative of the Mnangagwa family, was convicted of attempting to smuggle gold worth more than US$330,000.
Rashwaya, who is president of the Zimbabwe Miners’ Union, was found in 2020 with gold bars weighing 6kg in her hand luggage at the Robert Gabriel Mugabe International Airport in Harare while en route to the Middle East.
However, she was later fined $5,000 for this crime.
A documentary broadcast by the Qatar-based Al Jazeera television network, released last year, claimed that politically connected people were involved in gold smuggling.
Chiwenga said the government introduced the structured currency to ensure a stable macroeconomic environment free of exchange rate distortions.
He said, “This bold step symbolizes the government’s firm commitment to the program to eliminate the dollar, which is based on financial discipline, monetary prudence, and economic revitalization.”
“When we talk, for example, mostly about gold, we cannot keep tons of coal in the central bank, or gold or iron, or lithium or platinum, we will sell them. We have got our gold and we will dig and every gram of gold will not leave Zimbabwe.” .
In addition, he noted that the structured currency is expected to enable long-term business planning and encourage savings and investments in the economy.
According to him, this would go a long way in restoring confidence in the local currency.
“The stability of ZiG will boost investors’ confidence in the economy and lead to increased production and exports. The economy will also witness an increase in domestic demand as people’s purchasing power gradually improves amid falling and stabilizing prices,” he added.
“However, the government, through the central bank, will continue to monitor interest rates to limit speculative borrowing, ensure optimal money supply and keep inflation under control.” Newsday
