By Chantelle Tatenda Muzanenhamo
Concerns are mounting among Zimbabwe’s top retailers regarding the stability of the local currency the ZWG. The retailers have since written to the RBZ highlighting the losses they ar2e incurring due to the exchange discrepancies.
Government spokesperson Nick Mangwana sought to emphasise the relative strength of the ZWG against the currencies of neighbouring countries in a post he shared on hid X account this morning.
“1 USD = 1,341 Rwandan Francs
1 USD = 936 Angolan Kwanza
1 USD = 2,731 Tanzanian Shillings
1 USD = 1,723 Malawian Kwacha
1 USD = 1,634 Naira
What’s interesting is that you can’t legally buy anything using the USD in shops in all the above countries and others,” he stated in the post.
This statement comes amid increasing pressure from Zimbabwe’s retail sector, which has raised serious concerns about the rising tide of ZWG-induced losses.
Since its introduction, the ZWG has experienced a troubling decline, with parallel market exchange rates currently hovering around US$1 to ZWG39, reflecting the instability that has plagued the currency since its inception.
In comparison, countries such as Rwanda, Angola, Tanzania, Malawi, and Nigeria have maintained relatively stable exchange rates for years. For instance, Rwanda has effectively managed its economy to keep the Rwandan Franc stable, while Angola has navigated its oil-dependent economy to sustain the value of the Kwanza.
In contrast, Zimbabwe’s economic landscape has seen the ZWG fluctuate significantly within just a few months losing its value by over 100% on the parallel market, leading to a lack of confidence among both retailers and consumers.
As retailers call for urgent reforms and mitigatory measures to keep them in business, the Government faces mounting pressure to stabilize the currency and restore confidence among consumers. The outcome of this exchange rate induced economic challenge remains uncertain, but the implications for Zimbabwe’s business landscape could be huge if swift action is not taken.