Gono clarifies on Zim dollar return

HARARE - Zimbabwe's Central Bank governor on Thursday said the re-introduction of the Zimbabwe dollar will not be done immediately but in the medium to long term.

Gideon Gono, a close ally of President Robert Mugabe, spoke after the veteran leader told thousands of his Zanu PF supporters during the party’s election manifesto launch in Harare last Friday that he has been working confidentially with the Reserve Bank of Zimbabwe (RBZ) boss to introduce a gold-backed Zimbabwe dollar currency once he wins re-election in the July 31 poll.

In a statement on Thursday evening, Gono said discussions around this have been made with Mugabe, but said the re-introduction of a local currency would be done much later. 

The country has allowed the use of multiple foreign currencies since January 2009 to stem hyperinflation which had rocketed to over 230 million percent and left the Zimbabwe dollar almost worthless.

“As monetary authorities, we advise that as per the announcement by His Excellency President R.G. Mugabe, the re-introduction of a local currency is rather a medium to long term aspiration than an immediate, near-term agenda item on our radar as the Central Bank,” Gono said.

“Essentially, it is every country’s desire to have its own currency in order to avail potent policy options to policy makers, and Zimbabwe is no exception in this case.”

Gono outlined five key conditions, including attainment of sustained macroeconomic stability and re-orienting the economy on a firm recovery trajectory, before the local currency bounces back. 

Before the local currency is reinstated, Gono said there must be: 

*The accumulation of adequate foreign exchange reserve buffers to the Sadc regional target of at least 3 months of import cover but said Mugabe wanted that threshold doubled.

*The rehabilitation of infrastructure notably roads, water and sanitation, telecommunications and energy.

*The restoration of confidence generally and banking sector stability in particular. 

*The alignment of various pieces of legislation so that they complement each other.

*Rehabilitation and modernisation of necessary infrastructures, laws and administrative systems needed to successfully carry out the re-introduction assignment, together with appropriate pre-education and consultations with all those who need to be consulted internally and externally.

Gono said the above pre-conditions can be feasibly attained in the medium to long term.

“Additionally, the local currency according to the wishes of His Excellency, would be required to circulate alongside the basket of currencies which are currently legal tender in Zimbabwe and the public will be free to pick and use a currency of their choice for transactions purposes,” he said.

“Importantly too, is the fact that the sustained stability of the re-introduced local currency will also be contingent upon the accumulation of adequate assets from the country’s resources, notably gold, to enable the currency to be fully gold-backed. 

“This means that government would need to purchase from gold miners, adequate stocks of gold in order to build its bullion reserves.”

Comments (15)

zim dollar is coming back that's good news for us zanu pf supporters. kuchinja vanhu vagarisa ava. babajukwa.

mwaka uno - 11 July 2013

Taurai chokwadi kwete manyepo. President vakati they wont be rushing to re-introduce the Zimdollar. You must be ashamed of yourself Daily Lies.

edizah - 11 July 2013

why the need to clarify. The damage is already done, people are now very afraid.

Sadza nesauti - 11 July 2013

ZANU PF can never be trusted. They use the law of the jungle. People don't forget price controls, FCA accounts that were raided, jambanja paminda, skewed exchange rate so they could benefit from cheap currency in exchange for Zim dollars. The list is endless which is why we are in this mess. God help us

Cadre with the nation at heart - 11 July 2013

zanu pf is going to introduce the zimdollar. weather the pumpkin falls on the knive or the knive falls on the pumpkin. tichadya izvozvo nasekuru ava. ticharidzamhere remember 2007 /8.

hezvo - 11 July 2013

Just say it cant and how can a nation allow its people to pick and choose which currency to use. Just say the old dude was waffling again with no prepared speech and now you are fire fighting

munhu - 12 July 2013

Do not forget OPERATION MURAMBATSWINA!!!

Mqhafi - 12 July 2013

the Zimdollar era was bad and dont be politic tell us the truth so that we make our minds before the polls,change is certain

Jerry - 12 July 2013

We tired of ZANU PF lies, poor policy making and implementation, complete lack of direction just to name a few. Its time for change now. 33 YEARS is more than enough for the corrupt ZANU PF looters.

Tambainegidi - 12 July 2013

MAIHWE Zimbabwe dollar rinodzoswa zivai pekuvhotera!! Changamukai, makanganwa mavara eshato iyi here??

Titi - 12 July 2013

imbwa dzezanu dzatinetsa boyz zimdora vanoridii. machembere aya ngaende kupension msu wa 31 july, everybody boom musi wa 31 and ZANU thugs are gone

EARTHQUAKE31JULY - 12 July 2013

I don't think we will be needing the Zim Buck at the present time. I should say the Green buck is doing quite well don't you think...

Roy Gono - 12 July 2013

guys remember 2007/2008 ngatisakanganwe chezuro nehope vote yangu no mudhara gushu

farai - 12 July 2013

Never you trust Gono and Mugabe they can NOT manage currency Take a look at the Zim Dollar power since 1980 to 2009. PLEASE MUGABE AND GONO STAY AWAY FROM PEOPLE CURRENCY YOU MADE PEOPLE POOR OVER AND ABOUT WHAT SOMEONE HAS WORKED FOR LIFE. GONO SHOULD ACCOMPANY MUGABE ON 31 JULY TO THEIR RESPECTIVE BUSINESSES ZIMBABWEANS WERE THEIR EFFORTS ARE NEEDED MOST NOT FOR THE COUNTRY ANYMORE. WE WILL END UP BEING WORLD BURGERS AGAIN VERY SOONER. VANE NGOZI VADHARA PAMARI VANHU AVA. BE WARNED ZIMBABWE.

EYE - 13 July 2013

It is wise to first understand before you start talking. Also your analysis of an article should be impartial. It should not be apparent from one's comment that they are aligned to this or that party. What is a fact is that whether it is MDC or not which wins the elections, the Zim$ is returning. MDC would not be that useless to continue for another five years using fire fighting means like use of the US$. The return of the local currency is a certainty, no matter what party wins. And the return of the Zim$ though can never be done within less than a five to ten year period.

Non-aligned - 14 July 2013

Post a comment

Readers are kindly requested to refrain from using abusive, vulgar, racist, tribalistic, sexist, discriminatory and hurtful language when posting their comments on the Daily News website.
Those who transgress this civilised etiquette will be barred from contributing to our online discussions.
- Editor

Your email address will not be shared.