Zimbabwe’s gold reserves supporting the ZiG currency have reached US$533 million, fueled by increased mineral royalties and gold production. The Reserve Bank of Zimbabwe holds over three times the local currency in gold, marking a crucial step towards economic stability. Governor Dr. Mushayavanhu indicates further plans to enhance cash denominations and reserves as the economy strengthens.
Zimbabwe’s gold reserves supporting the ZiG currency have soared to US$533 million, primarily due to increased mineral royalties and gold holdings. This significant rise aligns with President Emmerson Mnangagwa’s initiative to allocate 50 percent of mineral royalties in kind, which has helped stabilize the country’s economy. The Reserve Bank of Zimbabwe (RBZ) holds 2.67 tonnes of gold, valued at US$228 million, exceeding three times the local currency in circulation, crucial for maintaining currency stability.
Since its launch on April 5, 2024, the ZiG currency has strengthened, with current circulation at ZiG183 million, accounting for 5 percent of the reserve money. Gold production in Zimbabwe reached a historical high of 36.48 tonnes in 2024, marking a 21 percent increase compared to 2023. This growth has enhanced the RBZ’s foreign reserves through increased royalties and foreign currency earnings from exports, aiding the backing of the ZiG.
RBZ Governor Dr. John Mushayavanhu commented on the impressive gold production levels, noting, “Indeed, the country’s gold production reached a record level of 36.48 tonnes in 2024, reflecting a 21 percent increase from the previous year’s output.” He emphasized the necessity of these reserves for supporting the ZiG and is looking into introducing higher denomination notes to streamline cash transactions while aligning with economic activity.
Plans for increasing cash in total deposits to 5 percent are being set, consistent with regional economic structures. Since its inception, the ZiG currency has bolstered economic stability, particularly between April and August 2024. The RBZ’s efforts in accumulating reserves reveal a strong commitment to fortifying Zimbabwe’s monetary framework and creating a stable economic environment.
The article discusses Zimbabwe’s growing gold reserves and their impact on the economy and the newly launched ZiG currency. Amid rising mineral royalties and significant gold production, the country’s gold reserves have surged, enhancing its economic situation. The Reserve Bank of Zimbabwe plays a critical role in managing these reserves to support the currency and ensure stability in economic activities.
In summary, Zimbabwe’s significant increase in gold reserves to US$533 million is a cornerstone for stabilizing the country’s economy through the ZiG currency. The record gold production and strategic moves by the RBZ to enhance reserves indicate a commitment to a stable financial future. The government’s focus on maintaining currency value and economic development shows promise for Zimbabwe’s economic resilience going forward.
Original Source: www.thezimbabwemail.com
