Trust is the real currency

This week, RBZ Deputy Governor Dr Innocent Matshe attempted to draw a line under one of the most contentious debates in Zimbabwe’s financial markets, the future of the U.S dollar after 2030.

His assurance that “contracts in U.S dollars will remain in U.S. dollars” beyond the official de-dollarisation deadline was designed to calm a jittery market, ease the fears of banks reluctant to extend long-term credit, and restore a measure of confidence in policy consistency.

It is a much-needed intervention. Since government’s announcement that the multicurrency system would be scrapped in December 2030, anxiety has steadily built across the economy.

To understand why Matshe’s words matter, one only has to recall the scars of 2019, when Statutory Instrument 142 abruptly outlawed foreign currency transactions and forced businesses to use a rapidly collapsing Zimbabwe dollar. Confidence evaporated overnight. Trade and investment froze. Ordinary households watched their savings vanish.

The psychological trauma of that episode still shadows every new monetary policy pronouncement.

That history explains why investors, banks, and corporates greeted the 2030 timeline with suspicion.

In a market where nearly 80% of all transactions are conducted in U.S. dollars, the very idea that contracts might suddenly be forced into ZiG in 2030 raised legitimate fears about enforceability, risk, and financial stability.

Many lenders simply stopped issuing credit lines beyond that horizon, unwilling to gamble with another forced conversion.

The RBZ’s latest assurance is therefore not just a matter of semantics, it is a lifeline for liquidity and long-term planning.

Still, calming nerves is only the first step.

The real test lies in whether the RBZ and government can demonstrate the credibility and discipline necessary to make these assurances stick.

Zimbabwe’s central problem has never been a lack of technical capacity or policy ambition. Rather, it is the repeated pattern of abrupt U-turns, conflicting pronouncements, and disregard for the sanctity of contracts that has eroded public trust.

Words, however carefully chosen, will mean little unless they are backed by consistent action.

This is where Matshe’s reassurance collides with reality.

Yes, U.S. dollar contracts may be guaranteed, but the broader de-dollarisation agenda remains on the table.

RBZ Governor Dr John Mushayavanhu insists that by 2030 the economic fundamentals will support a mono-currency regime anchored on the ZiG.

Yet those fundamentals, robust growth, deep reserves, fiscal discipline, and confidence in local institutions, remain distant goals. Zimbabwe’s macroeconomic environment is still fragile, shaped by limited foreign direct investment, sanctions, and reliance on remittances.

Attempting a rapid de-dollarisation without these pillars risks repeating the mistakes of the past.

Other emerging markets provide cautionary tales.

Argentina and Angola attempted abrupt de-dollarisation drives only to trigger inflationary spirals and capital flight. In contrast, Israel in the 1980s succeeded not because it outlawed the dollar, but because it pursued gradual reforms, restored fiscal discipline, and communicated clearly with its citizens. If Zimbabwe is serious about a 2030 mono-currency target, it must follow the Israeli playbook rather than the Angolan missteps.

For now, Matshe’s words have bought the RBZ some breathing room.

They will likely unlock frozen credit lines, give corporates confidence to sign long-term contracts, and reassure international partners that Zimbabwe is not about to stage another policy ambush. But this breathing room must be used wisely.

The central bank must prioritise building demand for the ZiG organically, rather than through coercion.

Already, signs of increased use of ZiG in electronic payments are encouraging, as is the surge in demand for ZiG cash. But without deeper confidence-building measures, tight inflation control, transparent reporting, and fiscal prudence, these gains could easily unravel.

There is also a broader philosophical question at play. Should Zimbabwe even be rushing to abandon the dollar at all?

For many households and businesses, the U.S dollar is more than a currency, it is a psychological anchor, a shield against uncertainty. Stripping it away prematurely risks undermining economic stability just as Zimbabwe is attempting to rebuild credibility on the global stage.

This is why policy consistency is more than just a technical requirement. It is a moral obligation.

As independent economist Mehluli Sibanda rightly observed, “Policy consistency is critical. Zimbabwe has burnt bridges before by reneging on currency promises.” Restoring that bridge will require more than the reassurance of a deputy governor. It will require a track record of discipline, transparency, and respect for market forces.

In the end, RBZ’s intervention was necessary, even welcome.

But it should not lull policymakers into complacency.

The confidence of banks, businesses, and ordinary Zimbabweans remains fragile.

The assurance that “U.S dollar contracts will remain in U.S dollars” may ease immediate tensions, but trust, the most valuable currency of all, will only return if this assurance is honoured consistently in the years ahead.

Zimbabwe stands at a crossroads. On one path lies the temptation of quick fixes, forced timelines, and politically driven monetary experiments that history has already proven disastrous.

On the other lies a slower, steadier march towards monetary sovereignty, one grounded in patience, discipline, and respect for the lessons of the past.

The RBZ has chosen, at least rhetorically, the latter path. The task now is to walk it faithfully.