Mining sector central to de-dollarisation drive: RBZ
The Reserve Bank of Zimbabwe (RBZ) has reaffirmed its commitment to restoring macroeconomic stability through decisive monetary policy reforms and an accelerated de-dollarisation roadmap with the mining sector positioned as a cornerstone of this economic transformation.
Speaking at the Zimbabwe Annual Mining Conference recently held in Victoria Falls, RBZ deputy governor Dr Innocent Matshe highlighted the strategic role of the mining industry in bolstering the country’s foreign exchange capacity, stabilising the newly introduced Zimbabwe Gold (ZWG) currency and driving the de-dollarisation agenda.
He said the mining sector continues to anchor economic stability due to its substantial foreign currency contributions, which are vital in supporting the ZWG and financing national obligations.
He noted that despite turbulent global conditions, including rising geopolitical tensions, protectionist trade policies and tightening global financial markets, the economy is showing resilience, with a projected growth rate of 6 percent in 2025, primarily driven by agriculture (21,1 percent) and mining (2,9 percent).
While global commodity prices have softened, Zimbabwe’s mining sector still contributed US$1,4 billion in foreign exchange inflows in Q1 2025, up from US$1 billion in Q1 2024, although its share of total forex inflows dipped to 44,3 percent in 2024, down from 49,5 percent the previous year.
The foreign currency generated through surrender requirements and in-kind royalties from mining is critical for liquefying the interbank market, meeting Government FX obligations, and building reserves to support de-dollarisation by 2030, said Dr Matshe.
Global financial conditions remain tight, as advanced economies adopt a cautious approach to reducing interest rates and this poses challenges for developing nations like Zimbabwe.”
Dr Matshe urged mining companies to lead the way in using the ZWG for procurement and payments, especially when sourcing locally produced goods and services.
Sustainable de-dollarisation requires a collective effort. The mining industry can significantly contribute by embracing the use of ZWG in transactions, he said.
Dr Matshe cited success stories from other economies that transitioned away from dollarisation through robust fiscal policies, sound monetary anchors and sufficient foreign reserves. He noted encouraging signs from the domestic monetary front. Since the structured currency’s introduction in April last year, the share of ZWG in transactional use rose from 26 percent to over 36 percent by April this year.
This was largely driven by increased Government payments, taxes in ZWG and a national rollout of point-of-sale systems.
Dr Matshe said the parallel market premium remains contained at around 20 percent, while the Real Effective Exchange Rate (REER) indicates a stable valuation of the ZWG.
Moreover, the RBZ’s foreign reserves now fully cover ZWG reserve money and banking sector deposits, offering a critical shield against external shocks.
Dr Matshe emphasised the RBZ’s dual responsibility of curbing inflation while stimulating economic growth. Our monetary policy stance must delicately navigate between reducing inflation and supporting robust economic growth, particularly in key sectors like mining, he said.-herald
