Zimbabwe’s Finance Minister, Mthuli Ncube, has expressed confidence in the nation’s gold-backed currency, Zimbabwe Gold (ZiG), hinting at its eventual replacement of the US dollar as the country’s sole legal tender. In an interview with Bloomberg, Ncube highlighted strong economic fundamentals, bolstered by domestic resource management and agricultural reforms, as driving factors behind his optimism.
“The economy is set to grow by 2%, even amid the worst drought in 40 years,” Ncube stated. He credited the resilience to government investments in agriculture and water infrastructure, including dam construction and the introduction of drought-resistant seed varieties. These efforts have paid off, with Zimbabwe expecting a bumper wheat harvest of 600,000 metric tons, marking self-sufficiency and plans to export surplus wheat.
Acknowledging the challenges of the drought, Ncube emphasized ongoing support from European donors and the government’s fiscal discipline in addressing vulnerabilities. He also revealed plans to expand agricultural insurance programs in 2025, targeting 22 drought-affected districts to provide greater protection to vulnerable communities.
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Turning to the performance of ZiG, Ncube described it as a stable currency underpinned by the country’s gold reserves. He highlighted its recent appreciation against the US dollar, signaling a shift in economic stability.
“There’s no reason why the currency shouldn’t remain stable,” Ncube said, noting that Zimbabwe has 13 billion ZiG in reserves compared to 12 billion in circulation. He also pointed to a budget deficit projected at just 1.4% of GDP by year-end, six consecutive years of current account surpluses, and tight monetary policies as indicators of economic strength.
When asked about the timeline for making ZiG the sole national currency, Ncube remained cautious. “One day, the Zimbabwe Gold will become the nation’s sole currency,” he said, explaining that the government has a roadmap in place but must carefully manage the transition to avoid speculative risks.
While no definitive timeline has been provided, Ncube’s remarks reflect the government’s long-term vision of reducing reliance on the US dollar, with ZiG positioned as a cornerstone of Zimbabwe’s economic future.
