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HARARE – Zimbabwe’s cabinet has approved a comprehensive plan to transition from the U.S. dollar to the country’s gold-backed currency, Zimbabwe Gold (ZiG), in economic transactions.
Finance Minister Mthuli Ncube will detail a roadmap for the shift.
“There is a roadmap for de-dollarization in terms of how the ZiG currency will be introduced as legal tender into the economy,” Information Minister Jenfan Muswere announced at a cabinet briefing in Harare on Tuesday. He mentioned that Minister Ncube would come up with a timeline for implementation, but did not specify when the announcement would be made. The Treasury has yet to comment on the matter.
Zimbabwe has relied heavily on the U.S. dollar over the past 15 years, with the dollar now accounting for about 70% of all economic transactions in the country, according to the central bank. When Zimbabwe launched its gold-backed ZiG currency in April, 85% of transactions were in dollars.
Zimbabwe’s President Emmerson Mnangagwa said the Zimbabwe dollar could become the sole currency by 2026, ahead of the initial target year of 2030, in a move supported by the banking industry.
During this period, authorities plan to increase penalties for those involved in “unfair price hikes, manipulation of the ZiG currency, smuggling and various unfair trade practices” to encourage ZiG adoption, Musverre said. Fines will be increased from a minimum of $200 to a maximum of $5,000 or its equivalent in ZiG.
Source: (Bloomberg)
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