STORY: Zimbabwe's new gold-backed currency enters circulation amid high inflation
SHOOTING TIME: April 30, 2024
DATELINE: May 2, 2024
LENGTH: 00:06:43
LOCATION: Harare
CATEGORY: ECONOMY

SHOTLIST:
1. various of ZiG currency notes
2. SOUNDBITE 1 (English): MUTSA MUTEVE, Local resident
3. various of ZiG coins, people counting coins, and a man buying water from a vendor using coins
4. SOUNDBITE 2 (English): LETWIN CHIMANGA, Local resident
5. various of people on the streets
6. SOUNDBITE 3 (English): KUNASA MUSAKURA, Local resident
7. various of people outside a local bank, a man holding ZiG notes and counting the notes
8. SOUNDBITE 4 (English): PROSPER CHITAMBARA, Economic analyst
9. various of people with new notes
10. SOUNDBITE 5 (English): PROSPER CHITAMBARA, Economic analyst
11. various of people with new notes

STORYLINE:

Zimbabwe's new ZiG notes and coins began circulating on Tuesday, marking a significant step in the country's monetary reform to curb inflation just three weeks after the electronic form of the currency started trading.
   
The Reserve Bank of Zimbabwe (RBZ), the country's central bank, introduced the new gold-backed currency, known as Zimbabwe Gold or ZiG, on April 5, replacing the inflation-ravaged Zimbabwean dollar. ZiG joins a basket of currencies accepted as legal tender in Zimbabwe, with the U.S. dollar currently dominating over 80 percent of all domestic transactions.
   
In the capital, Harare, residents queued at banks to withdraw the new currency, with many expressing optimism about the change.
   
Mutsa Muteve, a local resident, hailed the introduction of ZiG, noting its backing by gold as a unique feature that could positively impact the economy. 

SOUNDBITE 1 (English): MUTSA MUTEVE, Local resident
"ZiG is a currency which is backed by gold, and it's one of its own (kind) for the first time in Zimbabwe, of which if everyone has a positive attitude towards it and embraces it, I think it will make a better economy."

The physical notes and coins of ZiG come in various denominations, including 1 ZiG to 200 ZiG, as well as half ZiG and quarter ZiG. The availability of smaller denominations has brought relief to Zimbabweans, who previously had to make unnecessary purchases to round off figures to a dollar due to the unavailability of small change.

SOUNDBITE 2 (English): LETWIN CHIMANGA, Local resident
"People are eager to have our own currency because we were using the U.S. dollars. And as for transporting, some short distances they were costing 50 (U.S.) cents, but we were forced to pay a dollar because there were no 50 cents. But now with this new currency, we are now affording to pay the reasonable fares."

SOUNDBITE 3 (English): KUNASA MUSAKURA, Local resident
"The availability of the ZiG money, Zim Gold, now has made life easier for the people to transact in different ways, so I think it's good."

ZiG, which initially traded at an exchange rate of 13.56 to the U.S. dollar on April 8, is currently exchanging at 13.43 per dollar, according to RBZ exchange rate updates. The new currency is backed by precious minerals, mainly gold, as well as foreign currency reserves, according to RBZ Governor John Mushayavanhu.
   
SOUNDBITE 4 (English): PROSPER CHITAMBARA, Economic analyst
"ZiG is trying to address those fundamentals, especially around unsustainable growth in money supply, which then causes our inflation to remain high, so ZiG by tying money supply, reserve money supply to the reserve that we actually have, it's trying to tighten the monetary policy and ensure that there is no unsustainable growth in the money supply that is actually not supported by reserves, so that should help in terms of ensuring there is monetary discipline, which is critical in terms of ensuring overall macroeconomic or price stability within the economy because ultimately price stability is the biggest fundamental in any currency equation."

He noted that the black market had already emerged following the introduction of the new currency.

Zimbabwe's annual inflation rose to a seven-month peak of 55.3 percent in March from 47.6 percent in the previous month, according to data released by the National Statistics Agency.
   
Chitambara noted the emergence of a black market following the introduction of ZiG but expressed optimism that as inflation decreases, confidence in the new currency and the economy will increase.

SOUNDBITE 5 (English): PROSPER CHITAMBARA, Economic analyst
"We have seen obviously the black market has already emerged. But of course, I am sure that's expected given the strong demand and the strong preference for the USD that is actually still there. But I think once we begin to see inflation actually coming down, I think that's going to help in terms of restoration of confidence in the ZiG and ultimately confidence in the economy."

Zimbabwe has experienced currency instability in recent years, with ZiG marking the sixth relaunch of a new currency. The country adopted a multi-currency regime in 2009 to stabilize the economy after hyperinflation.
   
The government briefly outlawed the use of multiple currencies in 2019, only to reintroduce the multi-currency system in 2020, with the U.S. dollar gaining prominence in transactions since then.

Xinhua News Agency correspondents reporting from Harare.
(XHTV)