ZiG requires frequent auditing of both gold and ca...

ZiG requires frequent auditing of both gold and cash reserves: Zimcodd

Audrey Galawu

ASSISTANT EDITOR

The Zimbabwe Coalition on Debt and Development has said that the Zimbabwe Gold currency requires regular auditing of the physical gold and USD cash reserves by reputable and independent audit institutions.

Zimcodd said the ZiG currency risks suffering the same fate as the bond notes without trusted audits of the quantum of gold reserves in RBZ vaults.

The organisation highlighted that there is need to provide strong watch rails against gold leakages from the RBZ vaults, which can be caused by theft and fraud by corrupt public officials.

“More so, there is a need to set up public trust and investor confidence-building measures. These include, among others, massively reducing leakages of public resources by curbing public corruption, maintaining policy consistency, adopting a participatory approach to economic governance (multi-stakeholder consultations), and garnering adequate political will to swiftly implement a robust reform agenda (economic, governance, institutional, structural, land tenure systems reforms).

“This robust reform agenda is critical to improving government efficiency, strengthening institutional and regulatory frameworks, improving social fairness and inclusion, and eliminating prevailing excessive pricing distortions to reduce the cost of production, increase market competition, and spur innovation,” the organisation noted.

For the ZiG to succeed, Zimcodd also stressed out that authorities also need to adopt advanced technologies in gold production tracking and monitoring to minimise the chances of gold leakages and illicit trading.

“Traceability measures help curb criminality as information such as the exact source of gold, holder of gold buying license, and amount of taxes paid on gold exports can be collected and analysed.”

Zimcodd further noted that there is a need for a whole-of-government approach to curb illicit gold trading, otherwise, the expected increase in import bill “will render the ZiG worthless”.

Official statistics indicate that the ZiG is backed by RBZ reserve asset holdings constituting US$100 million in cash and 2.5 tonnes of gold worth US$185 million.