Zimbabwe's Currency Crisis: The Struggle of ZiG

Zimbabwe's new currency, ZiG, faces devaluation and skepticism five months after its launch. Despite government efforts and interventions to boost its use, the gold-backed currency lost almost 80% of its value on the black market. Traders and citizens remain hesitant to embrace it over stable alternatives like the U.S. dollar.

Zimbabwe's new currency, the Zimbabwe Gold (ZiG), is facing significant challenges just five months after its debut. The currency has depreciated nearly 80% against the U.S. dollar on the black market, eroding public confidence.

Independent economist Prosper Chitambara pointed to the currency's devaluation as a sign of widespread distrust among locals. Persistence Gwanyanya, a Reserve Bank of Zimbabwe's Monetary Policy Committee member, suggested an increase in local currency taxation to boost ZiG usage.

Despite these suggestions, market traders like Maynard Maketo and Carol Munjoma prefer the U.S. dollar due to the ZiG's instability. Government officials remain optimistic, yet the currency's future remains uncertain.

(With inputs from agencies.)