Mthuli Reassures People on ZiG: Public Remains Skeptical
Finance Minister Mthuli Ncube recently reassured Zimbabweans that the nation is well-positioned to avoid another wave of Zimbabwean dollar (ZWG) volatility. However, scepticism remains high among citizens and financial analysts alike.
Speaking at the Women’s Prosperity Conference, Ncube claimed that the country's reserves are sufficient to cover all ZWG deposits in the banking sector. He highlighted that measures have been implemented to stabilise the economy following a period of rapid exchange rate depreciation.
Ncube assured the public that the nation's finances are in good shape, with reserves currently sufficient to cover all ZWG deposits in local banks.
“At the current exchange rate of US$1:ZWG25, we have enough reserves to match the ZWG10 billion in local currency deposits. The value of our reserves amounts to US$425 million, which at the current exchange rate, also equals ZWG10 billion,” he explained.
Despite these assurances, many remain unconvinced. The recent history of economic instability and hyperinflation in Zimbabwe has left a lasting impression.
Mthuli Reassures People on ZiG: Public Remains Skeptical
Critics argue that the measures touted by Ncube, such as raising interest rates and reserve requirements, may not be enough to curb speculative demand for foreign currency and strengthen the local currency.
Ncube also stated that the situation has improved following the introduction of several measures aimed at restoring stability.
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“Prices of basic commodities have cooled off, and we have matched the balances between the local currency and the US dollar,” he said. Yet, the public remains wary, recalling past promises that failed to materialise.
Deputy Finance Minister David Mnangagwa addressed the idea of abandoning the Zimbabwean dollar in favour of using the US dollar exclusively.
“Dumping the Zimbabwe Gold (ZiG) currency might seem like a quick fix, but it is not a sustainable solution,” Mnangagwa said. This statement, however, does little to quell the fears of those who have witnessed the ZWG's dramatic fluctuations.
