Amid concerns over the impending introduction of Zimbabwe Gold (ZiG), the Reserve Bank of Zimbabwe has reaffirmed that the Zimbabwe dollar remains legal tender until April 30. Reports have emerged of informal traders shying away from accepting the currency, fearing its depreciation once ZiG enters circulation.
The transition from the faltering Zimbabwe dollar to ZiG aims to bring stability to the nation’s currency and combat inflation. However, apprehension prevails, particularly among cash-dependent informal traders, who prefer transactions in U.S. dollars.
Marceline Mupotaringa, a vendor in Mt Pleasant Heights, noted the reluctance of fresh produce farmers to accept the Zimbabwe dollar, fearing its devaluation by the time ZiG is introduced. Such sentiments have rendered existing Zimbabwe dollar holdings seemingly worthless for some.
Acknowledging public concerns, the central bank urged businesses, including commuter omnibuses, shops, markets, and vendors, to continue accepting Zimbabwe dollar notes until April 30, 2024.
Brian Muchemwa, a fresh produce trader in Harare, highlighted the Zimbabwe dollar’s depreciated value post-ZiG announcement, prompting a shift to exclusively accepting U.S. dollars.
With the Zimbabwe dollar plummeting to 40,000 to $1 from its previous rate of 28,720, demand for U.S. dollars has surged, benefitting black market currency traders who have capitalized on the opportunity.
While larger retailers have begun adapting to the impending change by displaying prices in ZiG, some, like Zimbabwe’s OK and South Africa’s Pick n Pay, continue to accept the Zimbabwe dollar, contrasting with the informal sector’s reluctance.
OK CEO Max Karombo emphasized that major retailers have not rejected the Zimbabwe dollar, underscoring the divide between formal and informal sectors in currency acceptance practices.
