Zimbabwe to introduce new currency within 9 months

Government is working on modalities to introduce a new currency, which will be the sole legal tender for domestic transactions, within the next nine months, President Mnangagwa has said.

Speaking in an interview with Bloomberg on the sidelines of the 12th US-Africa Business Summit in Maputo, Mozambique, yesterday, the President said "it is necessary that we have our own currency" since it is presently difficult to determine the level of money supply in the economy.

"Then of course there is an issue which is critical also for any economy: this is the question of currency. I am not aware of any country which has no currency of its own, but that is not my field – I am a lawyer – but I am told that except for Zimbabwe I haven't been told of another country which doesn't have its own currency.

"Even poor countries have currencies from what I hear, so we intend to introduce our own," he said.

Separately, Finance and Economic Development Minister Professor Mthuli Ncube also indicated that a new currency would likely give tailwinds to the country's economic growth efforts.

"But I think the long-term goal, as His Excellency has said, you cannot develop without your own domestic currency, without the monetary-sector leg in terms of macro management – that is very, very critical. . ."

Government, he said, has successfully brought both the fiscal deficit and current account deficit under control and, therefore, this could critically support the new currency.

"So, in terms of macro fundamentals, actually, maybe we were a bit unlucky, but the fundamentals are in place. So there is no way that issuance of Treasury Bills or fiscal deficits are causing growth in money supply and, therefore, posing risk to currency value. That is not the case. So its something else that is driving the parallel rate – so many speculators."

More details to follow . . .