THE Consumer Council of Zimbabwe (CCZ) says the Zimbabwe Gold (ZiG) currency has brought more “challenges” for consumers than those they faced prior to its introduction, because people are failing to use the new currency outside the formal retail sector.
ZiG was introduced last month to replace the Zimbabwe dollar, but the new currency has faced public resistance, especially from commuter transport operators, making life difficult for consumers.
“As the Consumer Council of Zimbabwe, we were delighted when we heard that we are going to have a currency backed by gold reserves being announced by the governor of the Reserve Bank of Zimbabwe,” CCZ chief executive officer Rosemary Mpofu told NewsDay Business in an interview.
“We were very excited because we heard the country had enough gold to back the new Zimbabwe Gold currency. We very much believed that when the currency is backed by gold and other commodities, it would give more value to our currency.”
She said they believed that the money would give people more buying power like such other currencies as the South African Rand, Botswana Pula and the United States dollars.
“With that being said, as consumers, we are facing several challenges, which has resulted in us failing to easily accept the new currency,” Mpofu said.
“These challenges have greatly impacted the acceptance of the new local currency by consumers in the country. It seems the new currency has brought us more challenges than those we faced before the introduction of the Zimbabwe Gold currency.”
Mpofu noted that commuter operators were not eager to accept the new currency and were charging the public double the normal price because they cannot provide change.
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“When boarding public transport on our everyday normal routes, we see that the same route that we used to travel using US$0,50, we are being charged US$1 because of change challenges,” she said.
“Sometimes we are forced to buy things that we do not want just for us not to leave our money with public transport operators. The same route that I used to travel using US$1, to and from, the price has doubled.”
She also complained about how consumers were failing to buy fuel using the new currency despite the Zimbabwe Energy Regulatory Authority (Zera) announcing fuel prices in ZiG.
“Moreover, when it comes to fuel in the country, it was announced recently that consumers are now able to buy fuel in local currency and Zera announced the ZiG prices for fuel. However, we have not seen any fuel station that is accepting ZiG in exchange for fuel. We did a survey and also consulted with Zera and we discovered that so far, no fuel station is accepting ZiG,” she noted.
Mpofu also expressed her worry that service providers were rejecting the new currency, while others were still manipulating the exchange rate.
“Another challenge is emanating from schools. Several schools are rejecting the payment of fees using the new currency only accepting the US dollar. Where else are we going to use the ZiG currency?
“So far, the only place we can use the ZiG currency is in the supermarkets. Why are the service providers rejecting the ZiG currency?” she quizzed.
“Another pressing issue is that of the exchange rate. We were told by the central bank that the rate will be at US$1: ZiG13,56 with an allowance of service providers to have a margin of up to ZiG14 according to statutory instrument 118.
“However, we are seeing some charging with rates as high as US$1: ZiG21. We need to know what RBZ [Reserve Bank of Zimbabwe] and the FIU [Financial Intelligence Unit] are doing to deal with this.”
She urged the authorities to address these pressing issues and restore confidence in the new currency.
“So as CCZ, these are some of the challenges that consumers are facing, and on behalf of the consumers, can the authorities look into these issues to bring confidence in this currency?” she queried.
“They need to make sure that all businesses comply with the set exchange rate because they are the ones destabilising the new currency. Moreover, the authorities should continue dealing with the black market and should continue to arrest all the culprits. “Without addressing these issues, we are going to miss the target of reaching an upper middle-income economy by 2030,” she added.
