The International Monetary Fund (IMF) has urged Zimbabwe to provide more clarity on their de-dollarization plans. For the uninitiated, Zimbabwe had rolled out a plan to phase out the US dollar by 2030. The plan aims to make the local currency, the Zimbabwean Gold (ZiG), the country’s sole tender by 2030.

The IMF claims that Zimbabwe has withheld several important details about its 2030 de-dollarization plans. In a high-level meeting last week, the IMF consulted with the authorities of Zimbabwe, urging them to clarify their initiatives. Zimbabwe needs to answer whether the ZiG will be limited to domestic transactions and not international usage.

In addition, the IMF has requested Zimbabwe to answer whether bank deposits will be allowed to remain denominated in both the US dollar and the ZiG. The lack of clear and concrete details on de-dollarization by Zimbabwe could cause operational implications for existing foreign currency bank deposits, said the IMF.

This has increased uncertainty, and the IMF weighed on financial intermediation with Zimbabwe’s de-dollarization plans. “Additional clarity on the mono-currency transitional plan would help reduce uncertainty. The authorities should provide more clarity on the operational implications of the mono-currency transitional plan,” the IMF said.

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Zimbabwe’s De-Dollarization Plans Meet With the IMF

The Reserve Bank of Zimbabwe unveiled a de-dollarization roadmap with a new five-year economic blueprint. The central bank set the target to achieve the ZiG’s independent status by 2030. The ZiG is a gold-backed currency and aims to become the sole tender across the country. Zimbabwe adopted a multicurrency system in 2009 and is now coming out of that monetary system.

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The Zimbabwean economy is reeling under pressure as its GDP is in a slowdown. However, it has backed its currency with gold, making the ZiG a strong contender to achieve its de-dollarization plans. We will update this article after Zimbabwe provides all the mentioned answers to the IMF.