Connect with us

National

Another Zimbabwe gold coin sale registers little for most

Published

on

BY GAMUCHIRAI MASIYIWA

With the price of gold up globally, the Reserve Bank of

Advertisement

Zimbabwe in April put the gold coins it stopped minting a year earlier back on the

market.

But interested investors had to act fast.

Advertisement

By mid-June, the sale of coins from its accumulated stock was abruptly concluded

and another chapter of the currency chaos that has characterized the nation’s

economy for decades was in the books. This time, at least, economists say the

Advertisement

experiment had little effect.

The short-lived sale is just the latest example in a long line of inconsistent policies,

says Ithiel Mavesere, a lecturer in the economics and development department at theUniversity of Zimbabwe. Storing value in a gold coin is not a viable option for the

Advertisement

majority of the population, he adds.

“Ideally, what they should have done is come up with low-value coins, with

denominations as low as equivalent to US$20 for the majority of the population to

Advertisement

afford,

” Mavesere says.

However, Reserve Bank of Zimbabwe Governor John Mushayavanhu says in a written

Advertisement

response to Global Press Journal that the gold coins were effective as an alternative

investment instrument and there was huge demand from both corporations and

individuals. According to RBZ data, corporations bought about 79% of the gold coins

Advertisement

and individuals bought about 21%.

About US$12 million’s worth sold

The lowest denomination of the coins represents a tenth of an ounce of gold,

Advertisement

equivalent to 9,299.13 in Zimbabwe gold, or ZiG, the national currency, or about

US$347. The highest denomination of the coins represents one ounce of gold,

equivalent to ZiG 92,991.34 or about US$3,470.

Advertisement

In all, the central bank has sold gold coins worth ZiG 343 million, or about US$12.8

million, according to Mushayavanhu, who says the recent sale happened after the

bank noted increased demand following the rise in international gold prices.

Advertisement

“In this context, the Reserve Bank re-issued an accumulated parcel of gold coins from

a combination of gold coins which had been bought back from the market through

redemptions and some coins which were still being held at the Reserve Bank from

Advertisement

the previously minted stock,

” the governor wrote.

A statement from the bank in mid-June announcing the halt to the sale indicated it

Advertisement

had been intended to clear the stock of gold coins it had and those that had been

cashed in by their holders.

Mushayavanhu says the bank stopped minting gold coins in April 2024 to prioritize its

Advertisement

gold reserve which, along with foreign currency reserves, backs the Zimbabwe gold

currency.

He says foreign reserves increased from US$270 million in April 2024 to US$731 million

Advertisement

as of the end of June.

The central bank first introduced the Mosi-oa-Tunya gold coins — which share an

indigenous name for Victoria Falls — in 2022 at a time when the country was

Advertisement

experiencing currency instability with high inflation and continued devaluation of

what was then the national currency, the Zimbabwe dollar.

The coins aimed to reduce dependency on the US dollar and help stabilize the

Advertisement

economy. The coins helped mop up excess cash in local currency that was circulatingin the market. Coupled with other monetary measures in 2022, the monthly inflation

rate dropped from about 31% in June to about 12% in August that year.

However, the exchange rate of the Zimbabwe dollar drastically fell against the US

Advertisement

dollar and the government replaced it with the new Zimbabwe gold currency in April

2024. Since its introduction, the currency’s value has been cut in half.

A ‘drop in the ocean’

Advertisement

Lyle Begbie, an economist with Oxford Economics Africa, believes the sale of the gold

coins when they were introduced in 2022 was more of a revenue-generating scheme,

as it happened at a time when inflation was very high.

Advertisement

He says it makes sense that the recent sale of gold coins was influenced by the

increase in gold prices on the global market. But he adds that the value of gold coins

was too little to have an impact on the economy. Begbie says the US$12.8 million in

Advertisement

coins the central bank reported selling is less than 1% of Zimbabwe’s gross domestic

product — which the World Bank estimates at US$44 billion — a “drop in the ocean”

when it comes to the country’s macroeconomic picture.

Advertisement

Prosper Chitambara, an economist based in Harare, agrees the impact of the recent

sale was minimal. He says gold coins don’t have a significant impact on currency

stability in an economy like Zimbabwe’s, which is highly informal and also highly

Advertisement

dollarized — meaning it’s heavily reliant on the US dollar as a currency.

“Most economic agents in our economy prefer to transact using their US dollars

because it’s a highly tradable and highly liquid asset. … So there’s a huge confidence

Advertisement

and trust in the USD than in the gold coins or even in the Zimbabwe gold,

Chitambara says.

Advertisement

Samuel Wadzai, the executive director of Vendors Initiative for Social and Economic

Transformation, an organization in Harare that advocates for the informal business

sector, says there have been a few instances where members have tried to use gold

Advertisement

coins for everyday transactions, but it hasn’t been widespread.

“Most traders still prefer cash due to the challenges of acceptance and the limited

understanding of gold coins in everyday trade,

Advertisement

” he says.

Isheanesu Kwenda, 31, a Harare street vendor with a sociology degree, says the recent

sale of gold coins didn’t offer any benefit for him. Like many Zimbabweans, he has

Advertisement

heard about the gold coins, but has never seen or opted to buy them. The vendor is

part of Zimbabwe’s informal economy, which sustains over 80% of Zimbabwe’s

population and contributes nearly 72% to the country’s GDP.

Advertisement

“Street economics informs that you should not attempt to get something you are not

sure of or do not understand. … I prefer to sell my goods and keep my money in US

dollars because it holds value, or I can keep my money in stock,

Advertisement

” Kwenda says of theclothing he sells.

Last year, Kwenda lost more than half his earnings after Zimbabwe gold was

introduced. After being paid the equivalent of US$1,000 in Zimbabwe dollars, he only

Advertisement

managed to salvage US$360 and lost the rest in exchange rate losses.

For Kwenda, restoring confidence is simple: The government must stick to a plan,

without making sudden U-turns

Advertisement

This story was originally published by Global Press Journal

Advertisement
Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

National

Government to equip Mpilo Hospital with radiotherapy machines funded by sugar tax initiative

Published

on

BY WANDILE TSHUMA 

Patients in Matabeleland North who rely on specialized care in Bulawayo are set to benefit from a major upgrade in cancer treatment facilities, as the government begins deploying equipment funded by the national sugar tax.

Advertisement

The Deputy Minister of Health and Child Care, Sleiman Timios Kwidini, confirmed to Parliament that the Treasury has released approximately $30.8 million to procure critical radiotherapy machines. Two low-energy units are earmarked for the country’s major referral centers, specifically Mpilo Central Hospital in Bulawayo and Parirenyatwa Hospital in Harare.

Advanced payments have been made to suppliers, and the government confirmed that installation is currently in progress alongside the preparation of specialized treatment bunkers. Kwidini described the move as a significant milestone intended to reduce patient waiting times and the costly need for referrals to facilities outside the country.

However, the announcement met with sharp criticism from lawmakers who argued the ministerial update lacked sufficient detail regarding the total revenue collected and the specific types of equipment purchased.

Advertisement

Surrender Kapoikilu led the debate, questioning whether the ministry had secured essential components like linear accelerators and diagnostic tools like endoscopes. He warned that without adequate surge protection, the high-tech equipment remains at risk from power fluctuations. “ZESA currents have many surges,” Kapoikilu said. “If you just plug it in, in five minutes, a machine is gone”.

 

He emphasized that effective treatment must begin with proper diagnosis, stating, “If you cannot diagnose cancer, you cannot conquer”.

Advertisement

The discussion expanded to include the dire state of basic patient care, with Corban Madzivanyika pointing out that referral centers often lack fundamental tools. “You get to the hospital and you are told that there is no wheelchair,” Madzivanyika told the House, describing the shortage of stretchers and wheelchairs as embarrassing.

Responding to the concerns, the Acting Speaker, Joseph Tshuma, directed the ministry to defer the matter and return with a more comprehensive dossier detailing the expenditure and the availability of essential medicines.

 

Advertisement

Continue Reading

National

Parliament weighs 40% community share in carbon credit deals

Published

on

BY NOTHANDO DUBE

Lawmakers in Zimbabwe are debating a comprehensive Climate Change Management Bill that supporters say will finally ensure rural communities are no longer “mere spectators” in the multi-billion dollar carbon credit industry.

Advertisement

The Bill, which moved into its second reading, seeks to regulate carbon trading and protect the country’s natural resources from foreign exploitation.

Mutsa Murombedzi delivered a passionate plea for the legislation, arguing that it is a matter of “justice, survival and the dignity of our people”. “Climate change is not a distant stone,” Murombedzi told the House. “It is the flood that we see in Chimanimani, which sweeps away our schools… the heatwave that scotches our communities in Hwange, one silent drought that empties our granaries”.

A major point of contention and hope is the proposed 40% community share in carbon projects. Lawmakers argued that previous projects often left locals with nothing but “tsotso stoves or bicycles” while profits were “repatriated back to their countries, particularly those from the global north”.

Advertisement

Master Makope applauded the move to bring transparency to a sector where deals were often done “without the knowledge of the authorities”.

“By having this policy framework, I believe our people are going to benefit,” Makope said.

“The Minister has to make sure that the villagers, the communities, should also have easy access to registration of their own projects because they are the ones who own these forests”.

Advertisement

The debate also focused on the establishment of a National Climate Fund.

Susan Matsunga insisted on rigorous oversight, suggesting a biennial reporting cycle to Parliament to ensure progress is measurable. “This is about building a culture of transparency that ensures our climate goals are not just promises on paper but measurable achievements,” Matsunga stated.

Murombedzi added that “Climate finance must not vanish into corridors in Harare; it must flow to the ward level where resilience is built”.

Advertisement

Continue Reading

National

Zim’s backyard pharmacies boom as economic crisis bites

Published

on

BY VANESSA GONYE

Health experts have expressed growing concern over the emergence of illegal herbal creams and unregulated drug sales on the streets of Harare and throughout Zimbabwe.

Advertisement

A disturbing increase in the presence and sale of unregulated medicines is bedeviling the country, with worry rising over the dangerous outcomes associated with these products.

In recent years, the capital has witnessed a sharp rise in informal drug outlets commonly referred to as “backyard pharmacies”.

 These unlicensed operations are often run from residential homes, tuckshops, market stalls, or simply from blankets laid on busy pavements.

Advertisement

In recent years, the capital has witnessed a sharp rise in informal drug outlets commonly referred to as “backyard pharmacies”.

 These unlicensed operations are often run from residential homes, tuckshops, market stalls, or simply from blankets laid on busy pavements.

Surveys reveal that these backyard pharmacies operate without any quality control, cold chain storage, or professional oversight.

Advertisement

Some of the drugs may be counterfeit, expired, adulterated, or incorrectly labelled.

Itai Rusike, the executive director of the Community Working Group on Health (CWGH), expressed alarm over the proliferation of these vendors, noting the trend puts patients’ health and safety at serious risk.

“The challenge is and has always been the gap in communicating the dosage schedule and indication for treatment,” Rusike said.

Advertisement

“There is no accreditation or regulation of the practitioners, their practice, nor their premises, as is done for registered pharmacists trained in conventional medicine”.

Rusike also highlighted a dangerous lack of scientific data: “There is generally a lack of clinical trials, scientific data and evidence to support the efficacy of street medicines, despite some claims from treated individuals”.

He called for widespread health and treatment literacy programmes to stop citizens from “taking wild gambles” with their health.

Advertisement

Rusike urged that: “the regulatory authorities should also be seen to effectively apply the laws regulating the sale of medicines in the country and protecting the health and safety of the general public without fear or favour”.

Johannes Marisa, president of the Medical and Dental Private Practitioners of Zimbabwe, echoed these concerns, stating that selling drugs from unregulated places is a major threat to public health.

“When we are talking of public health, we become very worried when we see drugs being sold everywhere,” Marisa said.

Advertisement

He warned that counterfeit drugs can create a “false belief that you are recovering from something, yet you are taking a counterfeit drug, which does not work”.

He added that such practices prolong infections and increase both morbidity and mortality.

The trend is largely driven by economic hardships that have made formal healthcare unaffordable for many, alongside high unemployment that has pushed individuals into pharmaceuticals as a lucrative vending commodity.

Advertisement

The Medicines Control Authority of Zimbabwe (MCAZ) has repeatedly warned that these unregistered products pose significant risks, including kidney and liver damage, high blood pressure, and increased cancer risk.

In response, the government has introduced stiffer penalties, with offenders now facing up to 20 years in prison.

SOURCE: THE STANDARD

Advertisement

Continue Reading

Trending

Copyright © 2022 VicFallsLive. All rights reserved, powered by Advantage