Zig- Zimbabwe Rolls Out World Newest and Gold-Backed Currency

May 27, 2024

Zimbabwe recently tried to get their economy back on track, which is why they made a new currency in April called the Zimbabwe Gold (ZiG). As a result of major economic problems and the failure of earlier currencies, this is the sixth attempt in 15 years to create a national currency.

Background and Deployment

When the Zimbabwe dollar fell apart in 2009, during a time of hyperinflation that was believed to be 5 billion percent, a 100-trillion Zimbabwe dollar bill was printed. Extreme steps like these showed how bad Zimbabwe’s economy was, which led to a system of multiple currencies with the U.S. dollar as the main currency. The government tried to fix these problems and make the local currency more stable by introducing the gold-backed ZiG. They hoped it would boost trust more than the ones that came before it.

Public Promotion and Response

When it came out, the ZiG was promoted in a number of ways, such as through music and direct talks with government leaders and the party in power, ZANU-PF. Even with all of this advertising, the new currency had a hard time getting accepted, just like other currencies before it. People were still skeptical because of ongoing economic problems and a desire for the more stable U.S. dollar, which is still used across the country for big purchases like rent and school fees.

Measures to Enforce Usage

In a controversial move, the government has made people use ZiG by making it harder to trade currencies on the black market. Currency dealers who were dealing at rates higher than the official exchange were arrested by the authorities. This caused a lot of trouble and criticism from the economic community about how harsh these measures were. Even though people who trade in illegal currencies are jailed or fined a lot, most economists agree that these actions alone are not enough to restore trust in the new currency.