Farai Mabeza, Senior Staff Writer 
THE Zimbabwe National Chamber of Commerce (ZNCC) says the lower denomination gold coins introduced by the Reserve Bank of Zimbabwe (RBZ) this week will offer a better store of value for the public than US dollars.
This comes after the first batch of gold coins released in July were deemed too pricey for the majority of the population.
ZNCC economist Jephias Makiwa told The Financial Gazette this week that the price of the new lot of coins would make them accessible to a wider market.
“After the introduction of the larger denomination coins in July, there was a public outcry that they were not affordable for the majority of Zimbabweans so the RBZ responded by saying it would introduce smaller denomination coins in November, which is this month.
“The price of the one-tenth ounce coin is around US$285 and at that price, I think it is affordable to the majority of Zimbabweans.
“Civil servants, or even those people in the private sector will be able to purchase those coins and preserve value,” Makiwa said.
“The gold coins have been working in tandem with other measures, such as the temporary freeze on payments to service providers by the government and also the move to ensure value for money in public procurement in a bid to contain inflation,” he added.
“We expect the downward trend in inflation to continue until maybe the first quarter of 2023.”
He however, cautioned that the country’s poor savings culture would mean that many people would still be unable to utilise the new facility.
“For those who have the capacity to save, this is definitely a better option to preserve value rather than going from the Zimbabwe dollar to the US dollar because you will be trading at parallel market rates,” Makiwa said.
“The savings culture in Zimbabwe is also poor given the experiences of the past with regards to inflation and value erosion.”
The RBZ rolled out the first batch of 2 000 gold coins in July hoping to stabilise an under-pressure local currency and rising prices of basic goods.
Purchasers can choose to keep the coins at a bank or take them home, while foreigners can only buy the coins in foreign currency.
Named Mosi-oa-Tunya, after the mighty falls on the Zambezi River, the coins have a liquid asset status — meaning that they can be converted to cash, and are tradable locally and internationally.
CBZ Holdings (CBZ), the biggest financial services group in the country, recently also commended the RBZ for introducing the gold coins, saying investors would find a store of value in the instruments.
In a statement accompanying the financial services group’s results for the half-year to June 30, 2022, group chairman Marc Holtzman said CBZ would throw its weight behind the central bank’s efforts.
“The group will continue to closely monitor these developments in order to better meet the expectations of its customers, employees, shareholders and all stakeholders,” Holtzman said.
”THE Zimbabwe National Chamber of Commerce (ZNCC) says the lower denomination gold coins introduced by the Reserve Bank of Zimbabwe (RBZ) this week will offer a better store of value for the public than US dollars.
This comes after the first batch of gold coins released in July were deemed too pricey for the majority of the population.
ZNCC economist Jephias Makiwa told The Financial Gazette this week that the price of the new lot of coins would make them accessible to a wider market.
“After the introduction of the larger denomination coins in July, there was a public outcry that they were not affordable for the majority of Zimbabweans so the RBZ responded by saying it would introduce smaller denomination coins in November, which is this month
“The price of the one-tenth ounce coin is around US$285 and at that price, I think it is affordable to the majority of Zimbabweans.
“Civil servants, or even those people in the private sector will be able to purchase those coins and preserve value,” Makiwa said.
“The gold coins have been working in tandem with other measures, such as the temporary freeze on payments to service providers by the government and also the move to ensure value for money in public procurement in a bid to contain inflation,” he added.
“We expect the downward trend in inflation to continue until maybe the first quarter of 2023.”
He however, cautioned that the country’s poor savings culture would mean that many people would still be unable to utilise the new facility.
“For those who have the capacity to save, this is definitely a better option to preserve value rather than going from the Zimbabwe dollar to the US dollar because you will be trading at parallel market rates,” Makiwa said.
“The savings culture in Zimbabwe is also poor given the experiences of the past with regards to inflation and value erosion.”
The RBZ rolled out the first batch of 2 000 gold coins in July hoping to stabilise an under-pressure local currency and rising prices of basic goods.
Purchasers can choose to keep the coins at a bank or take them home, while foreigners can only buy the coins in foreign currency.
Named Mosi-oa-Tunya, after the mighty falls on the Zambezi River, the coins have a liquid asset status — meaning that they can be converted to cash, and are tradable locally and internationally.
CBZ Holdings (CBZ), the biggest financial services group in the country, recently also commended the RBZ for introducing the gold coins, saying investors would find a store of value in the instruments.
In a statement accompanying the financial services group’s results for the half-year to June 30, 2022, group chairman Marc Holtzman said CBZ would throw its weight behind the central bank’s efforts.
“The group will continue to closely monitor these developments in order to better meet the expectations of its customers, employees, shareholders and all stakeholders,” Holtzman said.
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