Victoria Falls Correspondent
VICTORIA FALLS \u2013 The Reserve Bank of Zimbabwe (RBZ) has reaffirmed its commitment to stabilizing the economy and accelerating de-dollarization, banking on the mining sector\u2019s pivotal role to drive growth despite mounting global pressures, Deputy Governor Dr. Innocent Matshe announced at the Zimbabwe Annual Mining Conference this week.<\/p>\n\n\n\n
Addressing industry leaders, Dr. Matshe acknowledged the \u201ctoxic cocktail\u201d of geopolitical tensions, trade wars, and tighter global financial conditions dampening economic prospects worldwide.<\/p>\n\n\n\n
Global growth is now projected to slow to 2.8% in 2025, with inflation easing to 4.3%, but Zimbabwe\u2019s domestic economy, he argued, remains resilient.<\/p>\n\n\n\n
\u201cWhile global headwinds have suppressed mineral prices and capital inflows, our economy is poised to grow by 6% in 2025, anchored by agriculture and mining,\u201d said Dr. Matshe.<\/p>\n\n\n\n
Here highlighted agriculture\u2019s expected 21.1% surge and mining\u2019s 2.9% growth as key drivers, with the latter generating US$1.4 billion in foreign exchange inflows in Q1 2025 alone \u2013 up from US$1.09 billion in 2024.<\/p>\n\n\n\n
Mining: A Lifeline for Stability<\/p>\n\n\n\n
Despite a dip in mining\u2019s share of total forex inflows (from 49.5% in 2023 to 44.3% in 2024), Dr. Matshe emphasized the sector\u2019s \u201cirreplaceable role\u201d in stabilizing the Zimbabwe Gold (ZWG) currency and advancing de-dollarization.<\/p>\n\n\n\n
\u201cForeign currency from mining royalties and surrender requirements is critical to liquefying the interbank market, meeting government obligations, and building reserves to support our 2030 de-dollarization target,\u201d he stated.<\/p>\n\n\n\n
The deputy governor urged miners to \u201clead by example\u201d in adopting the ZWG, calling for increased local procurement and ZWG transactions.<\/p>\n\n\n\n
\u201cSustainable de-dollarization demands collective effort. Every miner sourcing local goods in ZWG strengthens demand for our currency,\u201d he said.<\/p>\n\n\n\n
Progress and Prudence<\/p>\n\n\n\n
Dr. Matshe touted strides in stabilizing the ZWG since the April 2024 launch of the structured currency. The parallel market premium, he noted, has been contained to 20%, while the Real Effective Exchange Rate (REER) shows \u201cno significant misalignment.\u201d Reserves now fully cover ZWG reserve money and banking sector deposits, \u201cbuffering against external shocks,\u201d he added.<\/p>\n\n\n\n
Transactional use of the ZWG has risen from 26% to over 36% in the past year, aided by government measures like tax payments in local currency and expanded Point-of-Sale (POS) systems.<\/p>\n\n\n\n
Inflation, meanwhile, is projected to fall to 30% annually by December 2025, with monthly rates averaging below 3%.<\/p>\n\n\n\n
Balancing Growth and Stability<\/p>\n\n\n\n
While optimistic, Dr. Matshe cautioned that monetary policy must \u201cwalk a tightrope\u201d between curbing inflation and fueling growth.<\/p>\n\n\n\n
\u201cWe remain committed to policies that anchor inflation expectations and sustain confidence in the ZWG,\u201d he said, stressing the need to shield key sectors like mining from volatility.<\/p>\n\n\n\n
The RBZ\u2019s de-dollarization roadmap leans on lessons from nations that achieved durable stability through fiscal discipline, robust reserves, and strong local currency demand.<\/p>\n\n\n\n
\u201cThe journey is arduous, but with mining as our cornerstone, we are on track,\u201d Dr. Matshe concluded, rallying stakeholders to \u201cforge a unified path toward macroeconomic resilience.\u201d<\/p>\n\n\n\n
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