Finance Minister Reveals Why The Zim Dollar Was Reintroduced

Finance Minister, Professor Mthuli Ncube has said that the Zimbabwean dollar was reintroduced to cushion workers who were now failing to access basic commodities as shops were charging in foreign currencies.

Ncube said that he met with an Association of teachers which lamented over their inability to buy basic commodities from shops and medical facilities which were pricing their goods and services mainly in US dollars. Most workers in Zimbabwe are paid in the local quasicurrency, the Real Time Gross Settlement (RTGS).

The RTGS dollar has been losing value against foreign currencies since its introduction in February. Consequently, inflation has been rising at an unparalleled rate. This in turn eroded the salaries of workers.

The minister also said that the introduction of the new Zimbabwe dollar does not change a lot of things. He said that the Zimbabwe dollar is comprised of the RTGS dollar (notes and coins).

He added that this newly introduced currency will be the only legal tender in Zimbabwe.

The Reserve Bank’s Statutory Instrument 142 of 2019 stipulates that all foreign currencies including the British pound, Botswana pula, and the South African rand are no longer legal tender in Zimbabwe.

Veritas Zimbabwe however said that the statement is vague as it does not outlaw the pricing of goods in US$. iT said:

….if shopkeepers mark their prices in US dollars, say, or insist on payment in that currency there is nothing to stop them doing so.

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Mthuli NcubeRTGS

Professor Mthuli Ncube is the Minister of Finance and Economic Development.He was the Chief Economist and Vice President of the African Development Bank ,financial, economics, investment, and public policy expert, entrepreneur and academic. Professor Ncube divides his time between the private sector in Switzerland and... Read More About Mthuli Ncube

Real-time Gross Settlement (RTGS) is a fund transfer system where the transfer of money takes place from one bank to any other bank on a "real time" and on a gross basis. Settlement in "real time" means a payment transaction is not subjected to any... Read More About RTGS

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