Published: 21 hours ago

Zimbabwe could eventually phase out the United States dollar for everyday transactions as part of a long-term plan to restore confidence in the local currency, a senior central bank official has said.

Reserve Bank of Zimbabwe (RBZ) deputy governor Innocent Matshe told delegates at the Zimbabwe Impact Investment Dialogue that authorities are working toward anchoring the economy on the Zimbabwe Gold (ZiG) currency.

The forum, hosted by the United Nations Development Programme (UNDP) and the Zimbabwe Investment and Development Agency (ZIDA), brought together policymakers and investors to explore ways of mobilising private capital for national development.

Matshe said the transition to a mono-currency system would be gradual, emphasising that it would not happen in the near term.

"Not soon, but one day," he said, noting that the ZiG has appreciated by about 2.5% over the past three months.

Under the proposed framework, foreign currency accounts would remain in place, allowing businesses and individuals to hold and transact in foreign currency when necessary. However, the use of U.S. dollar cash for routine domestic purchases would eventually be phased out.

"What will happen is you won't be able to go to the supermarket and use your U.S. dollars," Matshe said, adding that there would be no forced conversion of foreign currency balances.

He stressed that foreign-denominated obligations, including registered loans, would continue to be serviced in their original currency, while importers would retain access to foreign exchange through formal banking channels.

Zimbabwe has relied heavily on the U.S. dollar for over a decade, reflecting persistent concerns over the stability of local currencies. Authorities say reducing dollarisation and strengthening the ZiG are central to restoring monetary sovereignty.

"No country can develop using another country's currency," Matshe said, while acknowledging that rebuilding public confidence will require sustained policy consistency.

Economists say the success of the transition will depend on maintaining exchange rate stability, ensuring adequate foreign currency supply for key sectors, and strengthening broader economic fundamentals to support trust in the local currency.
- newsday

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