Zimbabwe's New Currency ZiG Faces Challenges and Opportunities
Zimbabwe Gold (ZiG), the new currency launched by the Zimbabwe Reserve Bank (ZRB), has performed well on the foreign exchange market but has faced difficulties in its home country.The ZRB has taken new measures to combat black market trading and through its X-accounts has appealed to the public to report illegal traders and businesses refusing to accept ZiG. Since ZiG was launched in physical form, it has risen 1.9 percent against the dollar. On May 15, police arrested 224 illegal foreign exchange traders and the RBZ Financial Intelligence Unit (FIU) froze 90 bank accounts and monitored bank activity to detect illegal transactions. The crackdown has led to a significant reduction in the number of illegal money changers in and around Harare's central business district. However, coin shortages continue to plague the central bank and the RBZ plans to increase the availability of small change. From June 10, Zimbabwe's Homelink Financial Services will offer ZiG debit card withdrawal services in seven cities, with other financial institutions joining in the future.The ZiG, Zimbabwe's sixth currency in 15 years, is backed by gold and foreign currency, but its introduction has been met with a mixed reaction from the public.
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