Shops across Zimbabwe have begun limiting customers to “one item per person” for essential products like milk, as panic buying sweeps the nation following another currency crisis.
The country’s latest currency, the Zimbabwe Gold (ZiG), supposedly backed by physical gold, lost 43% of its value last week in an official devaluation. This has sparked confusion among consumers and businesses alike.
Major retailers, including Pick n Pay and OK Supermarket, have warned they may need to close shops due to the sudden change in currency value. Last week, formal retailers had already cautioned the government that adhering to the artificially high official exchange rate could force them out of business.
“This abrupt change contradicts recent government assurances about the ZiG’s stability and its purported gold backing,” said Zimpricecheck, a retail sector watchdog.
Despite government efforts to crack down on illegal money changers, with over 300 individuals arrested and their accounts frozen, the black market for foreign currency continues to flourish.
One forex trader, speaking anonymously, told the BBC: “The same police that are sent to arrest us also need our assistance. Their salaries lost value last week and that has made them more interested in corruption for survival.”
Many Zimbabweans are sceptical about the new currency. Tererai Chamu, a tuckshop owner, said: “We are the true economists here and the government should ask us on the ground why the ZiG is failing.”
The crisis has left many people significantly poorer. Talent Ncube, who retired last month, fears his pension value may have been halved. “I’m just too stressed to think about it. I might as well leave the country before the money comes. There’s nothing to stay for,” he said.
The Reserve Bank of Zimbabwe blames the exchange rate volatility on illegal money changers. However, critics argue that the new official rate merely reflects the long-standing reality outside government-controlled transactions.
Teachers’ unions are calling on President Emmerson Mnangagwa to address the devaluation of civil servants’ salaries in his upcoming State of the Nation Address.
As Zimbabwe grapples with yet another currency crisis, many are left wondering about the future stability of the ZiG and the broader economic outlook for the country.
