ZIMBABWE is set to introduce high-quality ZiG banknotes in the first quarter of 2026, marking a major step in efforts to strengthen the country's currency architecture and improve public confidence in Zimbabwe Gold (ZiG).
Delivering the 2026 National Budget in Parliament on Thursday last week, Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube said production of the new notes was now at an advanced stage.
"A critical success factor for a smooth transition to a mono-currency is the availability of high-quality and durable banknotes," he said.
"In this context and as already communicated by the Reserve Bank in the February 2025 Monetary Policy Statement, the Bank is at an advanced stage in the production of high-quality ZiG notes.
"The Reserve Bank expects to roll out the high-quality ZiG notes in the first quarter of 2026. The roll-out plan, modalities and timing for the issuance of the high-quality ZiG notes will be announced by the Governor in the February 2026 Monetary Policy Statement."
He said the unveiling of the new ZiG notes did not mean the introduction of a new currency.
"It should be understood that this does not entail the introduction of a new currency, but the issuance of improved high-quality ZiG banknotes to ensure durability and public convenience," he said.
In his Monetary Policy Statement earlier in February, RBZ Governor Dr John Mushayavanhu said the central bank would enhance the quality of ZiG notes.
Meanwhile, the transition to a mono-currency will not entail the compulsory conversion of foreign currency holdings, while foreign currency accounts will continue to operate, with pension funds' holdings denominated in foreign currency being maintained.
Furthermore, the National Development Strategy 2 (NDS2) stipulates that US dollar-based stocks, shares and bonds, such as those on the Victoria Falls Stock Exchange (VFEX), will remain protected.
The addressing of concerns over asset protection in the multi-currency environment, where many savings and financial instruments are denominated in US dollars, is meant to safeguard public trust.
"The transition to a mono-currency does not, therefore, entail doing away with foreign currency accounts; holdings of pension funds denominated in foreign currency; and holdings of US dollar-based stocks, shares and bonds, such as shares held on the Victoria Falls Stock Exchange, including Treasury bills issued to smooth National Budget financing," reads the NDS2 document.
"Government assures all stakeholders that all the prior contractual obligations, including bank loans and advances made prior to the final date, will be preserved and honoured and economic agents will not lose money or value due to the transition to mono-currency."
All prior contractual obligations, including bank loans and advances made prior to the final date of de-dollarisation, will be preserved and honoured, and "economic agents will not lose money or value due to the transition".
The NDS2 document specifies a number of critical conditions that must be met before a sustainable mono-currency system can be introduced.
These conditions, which the Government must satisfy, include achieving durable macro-economic stability characterised by low and stable inflation, specifically at single-digit levels.
It also necessitates accumulating adequate foreign currency reserves equivalent to at least three to six months of import cover in the medium- to long-term.
Furthermore, the strategy demands a stable exchange rate and an efficient foreign exchange management system that eliminates market segmentation.
The Government plans to increase demand for ZiG through recalibrating the percentage of Government taxes and broadening the payment of public sector goods and services in the local currency, alongside ensuring fiscal and monetary policy cohesion.
Significant progress has been made towards meeting these conditions since the introduction of ZiG in April 2024, and the Government remains committed to creating the necessary market confidence for the transition.
Zimbabwe's monetary system has been largely characterised by a multicurrency system adopted in 2009, following a period of hyperinflation that rendered the local unit unsustainable at the time, which was largely dominated by the US dollar.
The decision to reintroduce domestic mono-currency is aimed at regaining control over the monetary policy, stabilising the economy by controlling inflation and interest rates and encouraging domestic savings and investment.
The goal is to regain levers of influencing economic dynamics, create a stable and predictable economic environment, strengthen local industries by stabilising input costs and build confidence in the financial system, rather than being vulnerable to external shocks.
While the US dollar has been instrumental in anchoring dollar inflation, using it as the primary currency presents challenges for Zimbabwe, including a lack of monetary policy control, a negative impact on trade competitiveness due to its strength and a shortage of small denominations, which creates practical challenges for retail transactions.
It has also caused capital erosion in the multi-currency setup, reduced investment and presented difficulties in business planning due to exchange rate volatility and liquidity constraints.