HARARE — The Zimbabwean government says it will not force businesses to accept the Zimbabwe Gold (ZiG) currency, opting instead to build confidence in the local unit through economic stability and gradual policy measures.
Justice, Legal and Parliamentary Affairs Minister Ziyambi Ziyambi made the remarks in the Senate on Thursday after Sen. Mdhluri said some businesses, particularly in light industry and downtown commercial areas, were refusing to accept ZiG despite it being legal tender.
Responding on behalf of the government, Ziyambi said authorities deliberately introduced ZiG alongside foreign currencies rather than eliminating the multicurrency system to give businesses and consumers time to develop confidence in the local currency.
“We have taken this decision because we were trying to build the relationship for all of us, or building a relation that people must accept that our ZiG is going to be eroded and it does not have power so that people can have confidence that even if they have got their monies in the bank, they will be able to keep their money and they will not be asking about the rate every day,” he said.
Ziyambi said the government had maintained tight control over the money supply, noting that ZiG currently accounted for about 20% of currency in circulation, while foreign currencies made up the remaining 80%.
He said taxes payable in local currency were also being used to encourage wider use of ZiG.
“We are currently requesting some of the taxes to be paid in local currency,” he said, adding that some fuel service stations were already accepting ZiG because they needed it to meet tax obligations.
Ziyambi said the government’s approach was to encourage, rather than compel, the use of the local currency.
“What we are not doing is forcing people to use ZiG, but we are allowing people to use ZiG and foreign currency. Those who are refusing to accept ZiG will accept it in the future, because they will see the fruits of using ZiG,” he said.
The minister said the Reserve Bank’s accumulation of gold reserves and exchange rate stability were intended to strengthen confidence in the currency and eventually reduce reliance on foreign currencies.
