No Government Evident in Zimbabwe

Details: Written by: John C Burke; Category: 45 years; Published: 17 April 2025; Hits: 319

Why do the World's Press, Governments and Academics, treat the Zanu PF Regime/administration in Zimbabwe as a Government?

UPDATE 18th APRIL 2025: Copy of our 45 years since Zimbabwe's Independence Petition as delivered to the PM and FCDO on the 18th April 2025 {CLICK HERE}

They are clearly and evidently a military mafia!

For 45 years they have dominated all the citizenry with intimidation based on gencode (Gukurahundi), Abductions, Torture and the campaigns of RAPE - yet they are still treated as a government?
In effect for 45 years the psychotic elite within Zanu PF have conducted a ruthless psychological campaign upon all Zimbabwean to remain in POWER - which appears to be their ONLY motivation - yet they are still treated as a government?
The ruling (non-democratic - or nothing like a democracy) regime has robbed & stolen all & any Wealth out of Zimbabwe - for their personal enrichment - yet they are still treated as a government?
The military mafia has deliberately and ruthlessly occupied/invaded/conquered every facet of the civic administration of Zimbabwe: the Military, The Police, the Electroral Commission, the Judiciary and more - yet they are still treated as a government?
At the same time they have not lifted a finger to maintain or update the high quality Infrastructure of the Ian Smith Government left to them on the 18th April 1980. Roads, Bridges, Rail, Air Lines, Surface Drainage, Flood Controls, Water Supply, Power Supply and lastly Sewage system - all are now a mere shadow of what was left to them. Worse - they are now a danger to the general population, in terms of health and safety. Mortailty and Maternal Mortality numbers are of grave concern - yet they are still treated as a government?

Whilst the blame lies squarely with the selfish, violent, criminal, corrupt morons within Zanu PF - one cannot help to wonder WHY the rest of the WORLD TREATS THEM AS A GOVERNMENT?

To illustrate this point let us shine a bright light upon the ZiG - something we said at launch that it was ANOTHER FRAUD! Yet Institutuion blindly took the Zanu PF clowns at their Word!

The long-term prognosis for Zimbabwe's ZiG currency, introduced in April 2024 as a gold-backed solution to chronic currency instability, appears precarious based on recent analyses, including Bloomberg articles and other sources. Below, I outline the key factors influencing its outlook, the debate over its gold backing, and the broader economic context, while critically examining the challenges and prospects.

1. Gold Backing: Sufficiency and Credibility

The ZiG, short for Zimbabwe Gold, is officially backed by a combination of gold, foreign currency reserves, and other precious metals, with the Reserve Bank of Zimbabwe (RBZ) claiming US$629 million in hard assets as of April 2024. Specific claims include 1.1 tonnes of gold worth approximately US$175 million and US$100 million in foreign currency reserves at launch. Additionally, the RBZ has reported increasing gold reserves due to rising royalty payments and higher global gold prices, which rose 24% since April 2024.

However, the sufficiency of this backing is debated:

Skepticism Over Reserves: Critics question whether Zimbabwe’s gold reserves are adequate to support the ZiG’s value, especially given the country’s history of mismanaging monetary policy. The IMF has cautioned that the ZiG alone cannot address deeper economic issues, suggesting that the gold backing may not inspire sufficient confidence.
Opaque Reserve Management: There is limited transparency regarding the actual size and management of Zimbabwe’s gold and foreign currency reserves. Past currency failures, like the Zimbabwean dollar’s collapse in 2008, fuel distrust in the RBZ’s ability to maintain credible backing.
Economic Pressures: Zimbabwe’s need for large grain imports and government overspending strain foreign currency reserves, potentially undermining the ZiG’s backing. By February 2025, the ZiG had lost 95% of its value on the unregulated market despite gold price increases, indicating that market forces and lack of trust outweigh the theoretical stability of gold backing.

While the gold backing provides a theoretical anchor, its effectiveness is undermined by low public confidence, limited reserve transparency, and external economic pressures. The RBZ’s claim of spending over US$400 million to support the ZiG since April 2024 further suggests that the reserves may be stretched thin.

2. Recent Performance and Challenges

The ZiG has faced significant challenges since its launch, as highlighted in Bloomberg and other reports:

Devaluation and Depreciation: In September 2024, the RBZ devalued the ZiG by 43%, adjusting the official exchange rate from 13.56 to 24.4 per US dollar due to a widening gap between official and black-market rates. By October 2024, the ZiG was trading at 27 per dollar officially but 40–50 per dollar on the black market, reflecting a 75% loss in value on unregulated markets by February 2025.
Inflation Surge: Inflation has eroded the ZiG’s purchasing power. Annual inflation hit 55.3% in March 2024 before the ZiG’s launch, and post-devaluation, monthly inflation surged to 37.2% in October 2024 (ZiG terms) and reached 14.6% year-on-year by January 2025, up from 2.5% in December 2024.
Limited Adoption: The ZiG struggles with acceptability, particularly in Zimbabwe’s informal sector, which accounts for ~80% of the economy. Most transactions (85% as of April 2024) are conducted in US dollars, and the ZiG is often accepted only under legal mandates, not market preference.
Policy Missteps: Tightened monetary policies in September 2024 temporarily halted further depreciation, but Bloomberg reports suggest that self-inflicted policy choices, such as curbing money supply, have led to liquidity crunches, threatening the ZiG’s viability.

These challenges indicate that the ZiG is not fulfilling its intended role as a stable store of value, unit of account, or medium of exchange, undermining its long-term prospects.

3. Long-Term Prognosis

The long-term outlook for the ZiG is dim unless significant structural and policy reforms are implemented. Key factors shaping this prognosis include:

Bearish Factors

Persistent Lack of Confidence: Zimbabwe’s history of hyperinflation (peaking at 5 billion percent in 2008) and repeated currency failures (the ZiG is the sixth attempt since 2009) has left the public and investors wary. The IMF notes that exchange-rate weakness is a symptom of deeper issues, particularly inflation and lack of faith in monetary and fiscal policy.
Economic Fundamentals: Zimbabwe’s economy remains battered by high unemployment, low industrial productivity, and reliance on gold exports, which are insufficient to address structural deficits. Ongoing grain imports and governmentthel government’s overspending further weaken the ZiG’s backing.
USD Dominance: The US dollar’s dominance (accounting for 85% of transactions) and the ZiG’s lack of international acceptability limit its utility, especially for imports and trade.
Policy and Political Risks: The ruling ZANU-PF’s push to make the ZiG the sole legal tender and phase out the US dollar lacks a clear timeline and faces resistance due to public preference for the USD. Political instability and a lack of fiscal discipline, as noted by Bloomberg, further erode trust.
Black-Market Pressures: The persistent gap between official and parallel market rates (e.g., 27 vs. 40–50 ZiG/USD in October 2024) fuels instability, forcing businesses to operate at a loss or close when adhering to official rates.

Bullish Factors

Gold Price Support: Rising global gold prices (up 24% since April 2024) theoretically bolster the ZiG’s backing, and increasing gold royalty payments could strengthen reserves.
Initial Policy Support: The IMF called the ZiG’s introduction an “important step” accompanied by monetary, exchange rate, and fiscal policy changes. The RBZ’s efforts to integrate the ZiG into the financial system and mandate its use for tax payments show commitment.
Early Adoption Signs: The RBZ reported a doubling in ZiG usage within months of its launch, suggesting some formal-sector acceptance.

However, these positive factors are overshadowed by structural challenges. The ZiG’s gold backing and policy measures have not translated into widespread trust or stability, as evidenced by its rapid depreciation and limited adoption.

4. Critical Perspective

The ZiG’s struggles reflect a deeper issue: a currency’s stability depends on trust and economic fundamentals, not just commodity backing. Gold backing alone cannot overcome Zimbabwe’s history of policy malpractice, as Bloomberg notes. The government’s refusal to accept the ZiG for certain services (e.g., passports, fuel) signals internal skepticism, further undermining public confidence. Moreover, the ZiG’s devaluation and inflation spikes mirror patterns seen in previous currencies, suggesting that without addressing root causes—such as fiscal discipline, political stability, and access to international lenders—the ZiG risks following its predecessors toward failure.

Bloomberg’s coverage emphasizes that the ZiG’s issues are symptomatic of broader economic mismanagement. For instance, Justice Malala argues that Zimbabwe needs political reform, not just a new currency, to address its challenges. The IMF’s caution that the ZiG cannot fix deeper issues aligns with this view, highlighting inflation and lack of confidence as core problems.

5. Conclusion

The long-term prognosis for the ZiG is poor unless Zimbabwe undertakes sweeping reforms. While its gold backing (valued at US$629 million, including 1.1 tonnes of gold and foreign currency) provides a theoretical foundation, its sufficiency is questionable due to opaque reserve management, economic pressures, and low public trust. The ZiG’s rapid depreciation (losing 95% of its value on the black market by February 2025), surging inflation (14.6% in January 2025), and limited adoption (rejected by the informal sector) signal a lack of credibility. Bloomberg articles underscore that the ZiG’s challenges stem from deeper issues—persistent inflation, policy missteps, and a history of currency failures—that gold backing alone cannot resolve.

For the ZiG to succeed, Zimbabwe must: - {But not a hope in Hell will this happen}

Enhance transparency in reserve management to build trust.
Address inflation through fiscal discipline and reduced overspending.
Gradually increase adoption by incentivizing ZiG use in the informal sector.
Pursue political and economic reforms to restore investor and public confidence.
Rebuild access to international lenders to reduce reliance on gold exports.

Without these measures, the ZiG risks extinction, as suggested by recent posts on X and Bloomberg’s reporting, potentially (??) joining its predecessors as another failed experiment in Zimbabwe’s troubled currency history.