INSUBCONTINENT EXCLUSIVE:
On April 8, 2024, Zimbabwe transitions to the gold-backed ZiG currency, moving away from the depreciating ZWL.This initiative, led by
Central Bank Governor John Mushayavanhu, relies on 2.5 tons of gold and diverse foreign currency reserves.The change aligns with extensive
required rapid adjustments within the financial sector, leading to a temporary halt in ZWL transactions.Financial institutions worked
diligently over the weekend to integrate ZiG into their systems.A 21-day period allows for ZWL note deposits before complete phase-out,
fiscal discipline, steering clear of the money printing that previously fueled hyperinflation.His approach reassures markets, despite
ZWL converted to ZiG at April 5 rates.Foreign exchange policies have been standardized, with a focus on a market-driven mechanism for import
finance, replacing the forex auction system.Interest rates have been cut dramatically from 130% to 20% annually, demonstrating the central
and public confidence by addressing the deep-seated issues of currency devaluation and inflation.The effectiveness of the ZiG and the
effective April 8, 2024, signaling a major monetary shift.Anchored by 2.5 tons of gold and a mix of foreign currency reserves, the ZiG aims
policy adjustments.These include fostering exchange rate and price stability while transitioning from the severely devalued ZWL, which has
dollars due to its informal economy.The transition to ZiG involved significant preparations by financial institutions.System updates over
the weekend for new currency, temporarily halting transactions in the old currency.Central bank offers 21-day window for ZWL banknote
deposits, preserving value for unbanked individuals before phase-out.Governor Mushayavanhu opposes money printing, shifting quasi-fiscal
excessive money printing.The central bank assures US dollar balances remain unaffected; ZWL balances will convert to ZiG at the April 5
exchange rate.Central bank standardizes foreign exchange retentions and adopts market-driven mechanism for import foreign exchange,
replacing previous auction system.Interest rates slashed from 130% to 20%
to a structured currency model, adding a contemporary twist to currency backing.This bold step by Zimbabwe aims to restore economic
stability and confidence, addressing long-standing issues of inflation and currency devaluation.We await the success of reforms and the
