The Reserve Bank of Zimbabwe (RBZ) has noted the growing acceptance of the local currency, ZiG, by both businesses and individuals, as the central bank continues its efforts to stabilise the economy.
Speaking at the recently held Institute of Chartered Accountants of Zimbabwe (ICAZ) event in Victoria Falls, RBZ deputy governor Dr Innocent Matshe highlighted the progress made in boosting demand for ZiG, a key element of the Government's strategy to curb inflation and restore confidence in the local currency.
The mandatory requirement for Government departments to accept all forms of payment in the multi-currency basket, including the ZiG, has been instrumental in driving its acceptance.
"We are pleased to note that there has been a significant uptick in the use of ZiG across various sectors," stated Dr Matshe. "This is a positive indicator of growing confidence in the currency."
The central bank's initiatives to improve the local currency cash availability, such as the expansion of Homelink administered service centres had also contributed to the increased use of the precious metal and foreign currency reserves-backed ZiG currency.
The success of the Homelink-enabled sites, with over ZiG250 000 being accessed daily, has significantly improved cash accessibility.
Furthermore, the RBZ's collaboration with retailers to facilitate coin circulation has also helped to address challenges related to issuing change.
Preliminary data from a recent survey conducted by the central bank indicated that most formal shops, including hardware stores and pharmacies, were now accepting ZiG payments.
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This growing acceptance of ZiG, which central bank chief Dr John Mushayavanhu introduced in April, is attributed to the increasing stability and predictability of the currency.
"The evolution analysis of the ZiG Perception Survey shows a progressive willingness by businesses and households to be paid in ZiG," Dr Matshe revealed.
While some challenges remain, the progress made in promoting ZiG acceptance is seen as a crucial step towards achieving macroeconomic stability.
The apex bank remained committed to implementing policies aimed at further enhancing the currency's position in the economy, with its general acceptance playing a critical role in economic stability.
Dr Matshe also revealed that inflation expectations are steadily declining, with month-on-month inflation projected to remain below 19 percent and annual inflation between 2-5 percent.
Positive economic growth prospects for 2024 are anticipated, driven by robust mining activity and exchange rate stability.
Already, the continued inflow of foreign exchange is expected to support exchange rate stability, and the banking sector's positive deposit rates are seen as conducive to economic growth.
"Confidence in the banking sector has remained favourable and improving as depicted by continued growth in foreign and local currency deposits. The ongoing stability under the ZiG environment is expected to further boost confidence in the banking sector and savings culture," said Dr Matshe.
