‘Sell locally produced raw materials in ZiG’

THE adoption of the Zimbabwe Gold (ZiG) currency brings hope to local businesses, especially manufacturing industries who are desperate for lower costs of production using the local unit as it promotes market competitiveness and boost exports, economic analyst Mr Dosman Mangisi has said.

In an interview yesterday, Mr Mangisi said the mainstreaming of the local currency in major transactions was critical and must be embraced by all stakeholders for the good of the economy.

He challenged businesses that produce critical raw materials to supply and trade these using the local currency to deliver solid confidence to the ZiG along their value chains.

Backed mainly by gold plus other precious minerals and a basket of foreign currency reserves, the ZiG is expected to curtail inflation and restore long-term macro-economic stability, with the multi-currency regime set to stay in place until at least 2030.

Mr Mangisi, who is also the Zimbabwe Institute of Foundries (ZIF) chief operations officer, said using the ZiG to procure different products will help improve the value appreciation of the local currency.

He said the foundry sector, for instance, was expecting to procure ferrochrome and coke among other locally sourced raw materials using local currency.

Professor Mthuli Ncube

“The procurement of raw materials, especially domestic products can be done using the ZiG, this can provide a level playing ground,” said Mangisi.

“The suppliers of products like coke should also have prices for local players rather than selling them at export prices to us, which is affecting the industry.

“If we export our final products, we receive 10 percent of our proceeds in local currency and accepting it when procuring raw material will help the appreciation of the ZiG considering that the sector is the one that uses a lot of foreign currency to keep it moving,” he added.

“So, the Government should focus more on manufacturing, especially metal casting to see how best the sector can move forward.”

Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, is on record saying the Government would continue to configure the Public Finance Management System (PFMS) to facilitate revenue collection and payment for goods and services in local currency.

The Treasury has since directed all ministries, departments, agencies and the private sector to accept and recognise ZiG as the official currency for all financial transactions and payment for all goods and services.

The ZiG started circulating in the market last month with the successful roll-out of lower denomination notes and coins ranging from ZiG1 to ZiG10. —chroncile