Zimbabwe’s New Gold-Backed Currency ZiG Targeted With Black Market Manipulation

At the beginning of April, Zimbabwe introduced a new currency called Zimbabwe Gold, or ZiG for short. What makes this currency special is that it’s fully backed by real, valuable assets like gold and other foreign currencies, giving it more credibility than past currencies the country has tried.

However, the ZiG is already facing challenges. Zimbabwe’s central bank governor, John Mushayavanhu, recently told Bloomberg that the new currency is struggling because of a growing gap between its official exchange rate and the rates on the parallel (black) market.

Here’s what’s happening: On the official market, one ZiG is worth 13.94 US dollars, but on the parallel market, it’s being traded for between 16 and 26 US dollars, according to ZimPriceCheck.com. That’s a big difference! Governor Mushayavanhu blames this on some traders and businesses who are hiking up the exchange rates when selling goods and services in ZiG. These traders are taking advantage of the situation to make mor...