IMF endorses Zimbabwe’s gold-backed currency, ZiG, as ‘positive policy action’

In its first public comment on Zimbabwe’s new gold-backed currency, the International Monetary Fund (IMF) has welcomed the introduction of the Zimbabwe Gold (ZiG) as a significant and positive policy action.

The endorsement comes after the ZiG was launched last month. The new money aimed at stabilising the economy is backed by gold and foreign currency reserves.

According to an IMF spokesperson, the introduction of the ZiG represents a major step forward, supported by important monetary, currency, and fiscal policy measures. This move is seen as a crucial step towards economic recovery and stability in Zimbabwe.

“The introduction of ZiG represents a significant policy action accompanied by several complementary policy changes, including monetary, currency and fiscal policy measures,” the Washington based IMF spokesperson told Bloomberg.

Zimbabwe has been unable to access financing from prominent international lenders like the IMF for over 20 years. This is due to its failure to service its debt obligations to various creditors, including the World Bank, African Development Bank, and European Investment Bank.

As a result, the country has been excluded from receiving crucial financial support from these institutions, hindering its economic progress and development.

The IMF delegation, led by Wojciech Maliszewski, completed a critical mission to Zimbabwe in February 2024. They called for the need for sweeping economic reforms to tackle pressing issues such as high inflation, currency volatility, and unsustainable debt.

The organisation said it remains committed to providing policy guidance and technical support.