Zimbabwe is preparing to abandon the US dollar, but the World Bank seems concerned as it sees trouble ahead

• The World Bank has warned Zimbabwe about its plan to rapidly dedollarize and rely solely on its new gold-backed currency, ZiG.
• Immediate dedollarization could cause capital flight and disrupt economic stability if trust in the ZiG is not established beforehand.
• Zimbabwe aims to prohibit the use of foreign currencies for local transactions by 2030.
• The World Bank noted that premature dedollarization could harm stabilization gains and widen illegal market activity.

Zimbabwe has received strong admonition from the World Bank about its strategy to completely dedollarize its economy.

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According to the global lender, Zimbabwe’s plan to immediately rid its domestic economy of the use of the dollar could lead to capital flight and undermine economic stability.

Zimbabwe is a few years away from relying entirely on its new currency, the ZiG, for all internal transactions.

    **The country set 2030** as the year when its people are no longer allowed to use foreign currencies for domestic consumption.

However, a recently released report from the World Bank shows that the date could be considered premature if confidence in the ZiG has not been firmly established.

"The government's goal of transitioning to a mono-currency ZiG system carries a risk of premature de-dollarisation," the World Bank said.

"Forcing a shift before local currency credibility is established triggers capital flight, widens parallel market premiums, and reverses stabilisation gains," it added.

Meanwhile, the global financier relayed that Zimbabwe could improve its ability to secure external loans as it works with multilateral creditors to address long-standing arrears and restructure its debt, as seen on Bulawayo24.

The country has been largely excluded from international debt markets since 1999, when it defaulted on its obligations.

France and the United Kingdom recently agreed to co-chair a platform aimed at supporting Zimbabwe’s efforts to restructure the billions of dollars it owes creditors.

The ZiG

    In April 2024, the Reserve Bank of Zimbabwe **launched a new gold-backed currency called ZiG** to help stabilise the economy and protect citizens from currency fluctuations and sky-high inflation.

ZiG, the new gold-backed currency, which stands for "Zimbabwe Gold", was introduced by the Central Bank Governor, John Mushayavanhu.

Mushayavanhu said the bank plans to phase out the Zimbabwean dollar, also known as the RTGS dollar, and transition to the gold-backed Zimbabwe Gold (ZiG) currency.

He said the RTGS dollar has lost about three-quarters of its value since the start of the year, adding that Zimbabweans would have 21 days to exchange their existing cash for the new currency.

A couple of years after the launch of the new currency, the bank began introducing redesigned notes for the new legal tender.

By March 2026, the Reserve Bank of Zimbabwe introduced a new series of Zimbabwe Gold (ZiG) banknotes, including the ZiG10, ZiG20 and ZiG50 notes, which were set to enter circulation on 7 April 2026.

The notes feature illustrations of the Big Five wildlife, a design choice meant to give the currency a clear national identity.