United States economist Professor Steve Hanke has ranked Zimbabwe Gold (ZiG) among the worst-performing currencies in the world.
This comes at a time when Zimbabwe is working on introducing a mono-currency system.
The new system is aimed at making ZiG the main currency of the country at the expense of the US dollar.
ZiG ranked the worst currency
According to United States economist Hanke, who compiles the Hanke’s Currency Watchlist, the ZiG is currently the sixth worst-performing currency globally.
The ranking is based on the rate of currency depreciation and the inflation experienced in countries that rely on these currencies.
The introduction of ZiG
The Reserve Bank of Zimbabwe (RBZ) introduced ZiG in April 2024.
A combination of gold and foreign currency reserves backed ZiG in a bid to restore confidence in the financial system.
However, despite early optimism, the currency has struggled to gain traction.
Many Zimbabweans continue to prefer the US dollar and South African rand, which remain widely used for everyday transactions.
Businesses, particularly in the informal sector, also continue to quote prices in foreign currency due to uncertainty around the ZiG’s stability.
Zimbabwe’s mono-currency system
The ranking comes as the Zimbabwean government plans to make ZiG the country’s sole legal tender. Authorities have maintained that the move will restore monetary sovereignty and strengthen the economy.
Meanwhile, critics argue that without addressing underlying structural issues such as low production, weak investor confidence, and policy inconsistency, the ZiG may face the same fate as its predecessors, rapid devaluation and public rejection.
Economists have urged policymakers to focus on stabilising inflation, building confidence in the central bank, and ensuring transparency in gold and forex backing if the currency is to survive and achieve long-term credibility.
