Several retail shops across Zimbabwe, including prominent chains like Pick n Pay and OK Supermarket, have started implementing strict “one item per customer” rules for staple products like milk. This comes in response to heightened panic-buying, which has surged due to growing uncertainty over the stability of the nation’s latest currency, the Zimbabwe Gold (ZiG).
Retailers Warn of Potential Shutdowns
Just last week, major retailers cautioned the government that they might have to shut down operations if compelled to sell goods at the state-mandated exchange rate for the ZiG. Following a sudden 43% drop in the official value of the currency, these businesses now find themselves grappling with severe revenue losses, sparking fears of widespread closures.
The currency, purportedly backed by physical gold, has fluctuated wildly. Despite promises of stability, the recent drastic devaluation has baffled consumers and made them increasingly distrustful of the government’s monetary policies. The watchdog Zimpricecheck states,
“The abrupt change starkly contradicts prior assurances by authorities about the currency’s supposed stability.”
Government Blames Black Market Traders for Instability
The Reserve Bank of Zimbabwe (RBZ) attributes the volatile exchange rate to illegal currency traders. So far, over 300 individuals have been arrested, and their bank accounts have been frozen. A high-profile case involves Neville Mutsvangwa, the son of prominent ruling party figures. He has been charged with illegal forex trading, but his parents contend that political adversaries are targeting him.
Widespread Distrust of the ZiG
Many citizens view the newly adjusted ZiG value as more reflective of the actual exchange rate that has been used outside government-sanctioned transactions. Small-scale entrepreneurs, like tuckshop owners, believe that the government should consult those operating in informal markets to understand better why the currency is floundering.-iharare
