Zimbabwe’s President Emmerson Mnangagwa has pledged to take decisive action to protect citizens’ incomes following the sharp decline of the country’s new gold-backed currency, the Zimbabwe Gold (ZiG), on the black market. 

In an address to parliament on Wednesday, Mnangagwa acknowledged the increasing challenges posed by parallel market activities and vowed to implement corrective measures aimed at stabilizing the currency and mitigating economic disruptions.

The ZiG, introduced five months ago in an effort to curb inflation and strengthen the country’s monetary system, has struggled to maintain its value. Last Friday, the currency was officially devalued by 43%, following a significant 47% loss in value on the black market. 

Despite the devaluation, the ZiG has continued to depreciate, slipping further from Friday’s rate of 24.3902 to 25.2824 against the U.S. dollar by Wednesday. On the black market, the situation has worsened, with the ZiG trading as low as 32 per U.S. dollar.

Mnangagwa attributed the currency’s struggles to speculative activities driving the parallel market and emphasized the need for corrective interventions. He reassured the public that measures are being put in place to protect Zimbabweans from further economic disruptions. 

The president also framed the currency devaluation as a necessary step to create greater flexibility in the market and to encourage those holding foreign currency to engage with the official market, rather than turning to the black market.