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The Zimbabwean dollar has weakened against the United States dollar (USD) at the Reserve Bank of Zimbabwe’s wholesale foreign exchange auction held on September 6, 2023. The USD was sold at a rate of ZW$4,647.9681, compared to ZWL$4,604.62 on August 29, 2023. This follows previous rates of ZW$4,571.29 on August 21 and ZW$4,573.77 on August 18. The majority of foreign currency obtained from the auction was utilised for purchasing raw materials, followed by machinery and equipment.
While the Zimbabwean dollar has been strengthening against the USD in recent months, this latest development indicates a shift in the trend. Authorities attribute the strengthening of the Zimbabwean dollar to the government’s implementation of measures to stabilise the economy and the local currency. These measures included restricting foreign currency in local transactions, and making the Zimbabwean dollar the sole legal tender for certain domestic transactions like taxes. This resulted in a reduction in money supply in the market. However, this reduction has been viewed by some analysts as intentional hoarding by authorities to create an artificial shortage.
Although the Zimbabwean dollar has shown recent stability, its long-term sustainability remains uncertain. Previous attempts to reintroduce the local currency have been met with limited success due to a lack of public confidence following the hyperinflation experienced in 2008 and subsequent policy changes resulting in monetary losses.
There are predictions that the local currency may further devalue after the recent harmonized elections held on August 23-24, 2023, which saw the ruling ZANU PF party secure victory. The future role of the United States dollar in Zimbabwe’s currency system also remains unclear.
In his inauguration speech, President Emmerson Mnangagwa emphasized the importance of a national currency for development, <a href="https://www.pindula.co.zw/2023/09/05/mnangagwa-hints-at-strengthening-the-zimbabwean-dollar/">hinting at a preference for the Zimbabwean dollar as the sole currency</a>. He also expressed a focus on utilising internal resources to foster economic growth. The evolving situation will determine the future direction of the country’s currency system.
<h3><a href="https://www.pindula.co.zw/">More Pindula News</a></h3>

Pindula News

Zimbabwean Dollar Weakened Against USD At Reserve Bank Auction On 6 September 2023

The Zimbabwe Dollar depreciated against the United States Dollar on the Reserve Bank of Zimbabwe wholesale foreign currency auction on Tuesday, 29 August.
After today’s wholesale auction, the Zimbabwe dollar averaged $4 604.62 against the US dollar.
On 21 August, the average interbank rate was $4 571.29, while on 18 August, it was $4 573.77.
Today, 18 bids were received, and all 18 bids were accepted and received allotments.
The total value of bids accepted was US$19,610,040.40 and a similar amount was allotted.
The amount on offer was US$20 000 000.00.
The highest bid rate was ZWL$4,650.0000 while the lowest bid rate was ZWL$4,570.0000.
The Retail Auction was allotted US$545 877.82, with the bulk of the allotment, US$220 379.23, going to services (loans, education, dividends, disinvestments, etc.).
<img alt="Image" decoding="async" src="https://pbs.twimg.com/media/F4sdi50XsAAYNbe?format=jpg&amp;name=4096x4096"/>
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Zimbabwe Dollar Official Rate Moves To $4 604 Per US Dollar

CCC leader Nelson Chamisa said that if his party gets into government, he will, “for a short period” of time, maintain the multi-currency system with the US dollar as the dominant currency.
Chamisa said the multi-currency regime will be a stop-gap measure as the economy transition to a new local currency.
The former ICT Minister said Zimbabwe’s currency will be stronger than the British pound as his government will restore confidence in the economy, which he said is a pre-requisite for a stable currency.
He was addressing party supporters at Muchakata Business Centre in Masvingo Central Constituency. <a href="https://tellzim.com/chamisa-promises-to-scrap-cala-school-exam-fees/">TellZim News</a> quoted Chamisa as saying:
<blockquote>
When we get into power, we need to fix the economy, but to do that we need to address the issue of currency.
We will use a basket of currency but mainly USD but that will be for a short period.
We will then introduce our currency which is stronger than the Pound, Deutsche M9ark, Yen and Yuan.
It’s possible and what makes the currency stronger is the type of leadership.
</blockquote>
Chamisa also pledged to ensure that the Continuous Assessment Learning Activities (CALA) is scrapped and a new education curriculum that captures the views of stakeholders is adopted.
He said under a CCC government, parents and guardians will not pay schools for their children from ECD to Grade 7, and at Advanced Level, while ZIMSEC examinations fees will be scrapped for Grade 7, O’ Level and A’ Level.
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

Chamisa Promises To Introduce A New Currency

President Emmerson Mnangagwa has hinted the Reserve Bank of Zimbabwe (RBZ) – controlled foreign exchange auction floor system could be done away with, saying it has served its purpose.
Mnangagwa told Brick by Brick magazine that the forex auction system was adopted to deal with a particular challenge that he said has almost been resolved. He said, as quoted by <a href="https://businesstimes.co.zw/govt-to-abandon-forex-auction-system/">Business Times</a>:
<blockquote>
As we go forward, we should reach a stage where we may not need it (Dutch forex auction system) because it’s not necessary.
It has been put there to deal with a particular challenge and I think that challenge is going away. We may reach a stage very soon where we may not need it.
</blockquote>
This comes after industry put pressure on the central bank governor, John Mangudya, to consider scrapping the “inefficient” foreign currency auction system or overhauling it.
Companies have been struggling to access foreign currency allotted to them through the foreign currency auction system, and going for several months before getting the allotted funds.
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

Mnangagwa Hints At Scrapping RBZ's Forex Auction System

The local unit today gained $32.0677 against the United States dollar to average $4 505.4232 at the Reserve Bank of Zimbabwe wholesale foreign currency auction.
This Tuesday, 25 July 2023, 16 bids were received, and all 16 bids were accepted. However, only 6 bids were allotted.
The total value of bids accepted was US$14,471.600.00 and US$7,900,600.00 was allotted.
The amount on offer was US$20 000 000.00.
The highest bid rate was ZWL$4,580.0000 while the lowest bid rate was ZWL$4,480.0000.
Below are the rates from the last six auctions:
<ul>
<li>25 July: $4 505.4232</li>
<li>20 July: $4 537.4909</li>
<li>18 July: $4,771.3854</li>
<li>14 July: $4883.8208</li>
<li>11 July: $4 998.8352</li>
<li>06 July: $5 251.0640</li>
</ul>
<img alt="Image" decoding="async" src="https://pbs.twimg.com/media/F14EGPHXgAAvWxF?format=jpg&amp;name=4096x4096"/>
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Zimbabwe Dollar Official Rate Now $4 505 Per US$1

The Zimbabwe dollar continued firming against the United States Dollar following the latest Reserve Bank of Zimbabwe wholesale foreign currency auction held on Thursday, 20 July.
The Zim dollar is now trading at ZWL$4 537.4909 from ZWL$4 771.3854 per US$1.
This Thursday, 13 bids were received, and all 13 bids were accepted. However, 11 bids were allotted.
The total value of bids accepted was US$6,383,500.00 and US$5,705,700 was allotted.
The amount on offer was US$20 000 000.00.
The highest bid rate was ZWL$4.711.7431 while the lowest bid rate was ZWL$4,537.4909.
Below are the rates from the last five auctions:
<ul>
<li>20 July: $4 537.4909</li>
<li>18 July: $4,771.3854</li>
<li>14 July: $4883.8208</li>
<li>11 July: $4 998.8352</li>
<li>06 July: $5 251.0640</li>
</ul>
<img alt="Image" decoding="async" src="https://pbs.twimg.com/media/F1d5RQ-XwAEywYZ?format=jpg&amp;name=900x900"/>
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Zimbabwe Dollar Official Rate Now $4 537 Per US$1

The Zimbabwe dollar has firmed again on the Wholesale Foreign Exchange Auction conducted on Friday, 14 July to ZWL$4883.8208 per US$1.
On Tuesday, 11 July, the weighted average was ZWL$4 998.8352, which was itself a significant recovery from the ZWL$5 251.0640 on 06 July 2023.
Today, 10 bids were received from banks, and all 10 bids were accepted but only 8 bids were allotted.
The RBZ said that the total value of bids accepted was US$5,295,000.00, while US$4,845,000.00 was allotted.
The amount on offer was US$20 000 000.00.
The highest bid rate received was ZWL$5,037.3700 while the lowest bid rate received was ZWL$4,700.0000.
<img alt="Image" decoding="async" src="https://pbs.twimg.com/media/F1AC0pNXoAI6h8A?format=jpg&amp;name=900x900"/>
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Zimbabwe Dollar Official Rate Now ZWL$4 883 Per US$1

The Zimbabwe dollar on Tuesday, 11 July further strengthened against the US dollar on the Reserve Bank of Zimbabwe forex auction.
According to the Wholesale Foreign Exchange Auction Results today, the weighted average was ZWL$4 998.8352.
This is a significant recovery from last week as the weighted average was ZWL$5 251.0640 at the Wholesale Foreign Exchange Auction Results of 06 June 2023.
Today, 10 bids were received from banks, and all 10 bids were accepted but only 8 bids were allotted.
The RBZ said that the total value of bids accepted was US$5 830 000.00, while US$5 640 000.00 was allotted.
The amount on offer was US$20 000 000.00.
The highest bid rate was ZWL$5 353.7221 while the lowest bid rate was ZWL$4 900.0000.
Meanwhile, the RBZ awarded US$460,130.60 to the retail auction.
The central bank also said all bids for the retail auction within the pre-announced amount were allotted in full.
It added that all bids for the retail auction with overdue CDIs, outstanding Bills of Entry (BOEs), insufficient ZWL and those with sufficient FCA balances were also disqualified.
<img alt="Image" decoding="async" src="https://pbs.twimg.com/media/F0wXSlDXoAI5Y1P?format=jpg&amp;name=4096x4096"/>

Zimbabwe Dollar Official Rate Now $4 998 To The US Dollar

There is a serious shortage of the Zimbabwe dollar in the economy which captains of industry and economists say will reduce production capacity and affect aggregate demand.
The liquidity squeeze follows recent fiscal and monetary policy measures to suck out liquidity in the market to stabilise the exchange rate and prices.
The Confederation of Zimbabwe Industries (CZI) president Kurai Matsheza told <a href="https://businesstimes.co.zw/zim-dollar-shortage-hits-market/">Business Times</a> that the liquidity crunch has reduced production capacity and aggregate demand. He said:
<blockquote>
There is a liquidity challenge in the economy and what the liquidity challenge does is depresses aggregate demand as there is no traffic in the shops and at the industries.
We are happy that things have stabilised but with this squeeze, we are failing to make payments for other services because there is no ZWL$ in the market and this has reduced our production capacity.
What it means is less cash in the markets, less product off-take so it means production will go down because companies can’t produce stock as they have no funds.
We, however, hope that this would be temporary and not a long-term solution so that business goes back to normal.
</blockquote>
The Confederation of Zimbabwe Retailers (CZR) president Denford Mutashu said in the past two weeks there has been an increase in US dollar sales but the Zimbabwe dollar sales have significantly decreased.
Economist Gift Mugano said the government has stopped pumping money into the market resulting in a shortage of the local currency.
He added that this confirms the long-held belief that government is the biggest driver of inflation.
Due to the liquidity crunch, the Zimbabwe dollar significantly recovered this week and was trading at ZWL$5 739 to the USD at the Reserve Bank of Zimbabwe (RBZ) Wholesale Foreign Exchange Auction on Thursday, 29 June.
On Tuesday, the local currency firmed against the United States Dollar to ZWL$6 326, from ZWL$6 926 on 20 June.
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

Captains Of Industry, Shops Bemoan Zimbabwe Dollar Shortage

The Reserve Bank of Zimbabwe’s (RBZ) official exchange rate has moved to almost ZWL$7 000 to the US dollar.
The Weighted Average Rate from the forex auction conducted on Tuesday, 20 June 2023, was ZWL$6 926.5764.
On 13 June 2023, the wholesale weighted average was US$1: ZWL$5 978.6794.
Today, the RBZ said 73 bids were received on the regular forex auction, and all the bids were accepted but only 50 bids were allotted. The total amount allotted was US$1,135,542.46.
On the wholesale auction, 12 bids were received and all the bids were accepted and all received allotments. The RBZ said the total amount allotted wasUS$10,614,000.00
The RBZ said that all bids within the pre-announced amount were allotted in full.
It said bids with overdue CDIs, outstanding Bills of Entry (BOEs), insufficient ZWL and those with sufficient balances were also disqualified.
<img alt="Image" decoding="async" src="https://pbs.twimg.com/media/FzEmboWaMAM6p9d?format=jpg&amp;name=900x900"/>
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Zimbabwe Dollar Official Rate - 20 June 2023

Former Chivi South MP, Killer Zivhu (ZANU PF) has claimed that villagers now prefer barter trade than accept payment for their products in Zimbabwe Dollars.
Zivhu, who was expelled from ZANU PF after he called for dialogue between President Emmerson Mnangagwa and CCC leader Nelson Chamisa, also said touts now measure the local currency in kilogrammes. He said:
<blockquote>
Manga muchiziva here kuti kumamisha, vava kuti marara RTGs, hanzi noumwe Hwindi chingopekai Bond muma 1kg, kombi yava kuita 1kg bond, mumwe muchembere hanzi zviri nani, kundipa 2kg ye sugar ndokupa mugomo we mbambaira, mari inorambiwa chero ne benzi hanzi haitengi. (Did you know that villagers are now saying the Zimbabwe Dollar is now rubbish? One kombi tout said pack ZimDollar notes in 1kg packs because a ride now costs a kilogramme of Zimbabwe dollars. An elderly woman said it is better to give her a 2kg packet of sugar for her bucket of sweet potatoes. Imagine, a currency that even a madman rejects!
</blockquote>
Some manufacturers are reportedly refusing payment in Zimbabwe dollars for some products which are now exclusively available in foreign currency.
The Zimbabwe dollar has been in free-fall over the past few months after the Government tweaked the forex auction system.
Last week, the RBZ set the official exchange rate at US$1: ZW$5 900 while the street rate was hovering at US$1: ZW$9 000.
However, some large retailers were using at least US$1: ZW$10 000 for selected products.
Popular fast-food outlets were rejecting the local currency on the pretext that their point-of-sale machines were not working and therefore could not accept swipe and EcoCash payments.
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

Even Madmen Now Rejecting Zimbabwe Dollar - Zivhu

The Reserve Bank of Zimbabwe (RBZ) has set the official exchange rate at almost ZWL$6 000 to the US dollar.
According to the results of the foreign exchange auction conducted on Tuesday, 13 June 2023, the wholesale weighted average was US$1: ZWL$5 978.6794.
On 06 June 2023, the weighted average was US$1: ZWL$3 673.7718, from US$1: ZWL$2 577.0564 on 30 May.
Today, the RBZ allotted a total of US$2,945,406.28, down from US$4,987,432.34 allotted last week, with the bulk of the allotment going to raw materials, followed by machinery and equipment.
The RBZ said that all bids within the pre-announced amount were allotted in full.
It said bids with overdue CDIs, outstanding Bills of Entry (BOEs), insufficient ZWL and those with sufficient balances were also disqualified.
The RBZ added that starting the week beginning 19 June 2023, authorised dealers will submit bids for the two auctions, that is, the forex auction and the wholesale forex auction by 9 AM on Tuesdays.<img alt="Image" decoding="async" src="https://pbs.twimg.com/media/Fyg5E20WIAQl9PI?format=jpg&amp;name=4096x4096"/>
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Zimbabwe Dollar Official Rate Now $6 000 To The US Dollar

The Zimbabwean Dollar has further lost its value this Wednesday, 07 June 2023, from ZWL$3 673.7718 to ZWL$4 868.5152 within 24 hours against the US Dollar at the Wholesale Foreign Exchange Auction announced by the Reserve Bank of Zimbabwe (RBZ).
On Tuesday, the Zimbabwe dollar fell by over $1 000 to average $3 673.7718 against the United States (US) dollar on the foreign currency auction held by the RBZ, down from US$1: ZWL$2 577.0564 on 30 May.
Below are the RBZ Wholesale Foreign Exchange Auction Results for 07 June 2023:
<blockquote>
Wholesale Foreign Exchange Auction Results – 7 June 2023
Number of Bids Received From Banks: 19
Number of Bids Disqualified: 0
Total Number of Bids Accepted: 19
Total Number of Bids Allotted: 10
Total Value of Bids Accepted Amount: USD12,993,000.00
Allotted: USD11,180,000.00
Highest Bid Rate Received: 5,020.0000 
Lowest Bid Rate Allotted : 4,500.0000
Weighted Average Rate: 4,868.5152
<img alt="Image" decoding="async" src="https://pbs.twimg.com/media/FyB3utPWcAMZHUv?format=jpg&amp;name=900x900"/>
</blockquote>

Zimbabwe Dollar Official Exchange Rate Now $4 868

Some retailers are reportedly refusing payment in the local currency or limiting the number of items people can buy in Zimbabwe dollars, which they say has become very unstable.
The Zimbabwe dollar was reintroduced in 2019 after a decade of the multicurrency system but it has been depreciating alarmingly.
On the parallel market, the Zim dollar is trading between $2 100 and $2 200 to the greenback, and US$1 036 on the official market.
Some retailers in Harare are reportedly limiting the number of items one can buy using Zimdollars.
The products include cooking oil, meat, mealie-meal, rice and beverages. Some shops are selling the products exclusively in US dollars.
An official at one of the country’s leading meat suppliers who spoke to <a href="https://www.newsday.co.zw/local-news/article/200010769/alarm-as-businesses-ditch-zimdollar">NewsDay</a> on Thursday on condition of anonymity said:
<blockquote>
There are some businesses trying to take advantage of the fact that we are selling in local currency to come to dump their Zimdollar stock and then sell the meat or merchandise they buy from us in US dollars.
This has become prevalent, so to dissuade this practice we are limiting stocks on certain products.
</blockquote>
Finance and Economic Development Deputy Minister Clemence Chiduwa told NewsDay that the Financial Intelligence Unit (FIU) was monitoring developments in the retail sector. He said:
<blockquote>
We are getting reports that some supermarkets are demanding payment for certain products exclusively in US dollars.
The Bank Use and Promotion Act applies the same way as trading in the parallel market.
This is illegal and all operators are urged to abide by the laws. We are closely monitoring the market delinquency and deviance which is a violation of the law.
The FIU is taking appropriate action against those who are exclusively accepting USD on certain products.
The continued depreciation of the Zimdollar is due to inflationary expectations mainly driven by parallel market rates.
The resultant instability due to chasing rates is negatively affecting all of us.
Market players should focus on production and the generation of forex.
</blockquote>
Meanwhile, Delta Beverages spokesperson Patricia Murambinda, told NewsDay the company was not responsible for the actions by retailers in charging its products exclusively in US dollars.
More: <a href="https://zero.pindula.co.zw/">Pindula News</a>

Some Businesses Reject Zimbabwe Dollar

Economics Professor Gift Mugano says increasing productivity is the only way to break the currency cycle in Zimbabwe and reinforce the stability of the Zimbabwe dollar.
Some economic commentators believe that the local currency “is technically dead” as US dollar transactions are now around 80 percent.
Speaking during an interview with <a href="https://www.businessweekly.co.zw/zim-heads-for-another-painful-currency-cycle/">Business Weekly</a>, Gift Mugano said “the easiest policy move” that the government can take to break the currency reforms merry-go-round is to stop corruption and the issuance of statutory instruments. Said Mugano:
<blockquote>
We need to be a productive economy. Arguably addressing production challenges requires a day on its own but off the top of my head, I would argue for the removal of arbitrage opportunities in our foreign currency markets, reform the financing of agricultural models by moving away from state finance to a market system development where actors in the value chains take an active role in financing agricultural production and use of special economic zones as effective vehicles to attract investments.
Most importantly, the easiest policy move that government can take is radically stop corruption and guarantee policy consistency, clarity, and predictability and make a deliberate position to stop the issuance of statutory instruments.
</blockquote>
He also said the new salary increment for civil servants will increase the volume of transactions in US dollars which will in turn result in an increase in “fake US dollars” in the banking system.
Mugano said the “fake” US dollars or US dollars in RTGS are being created by the banking system and Government, combined, through the process of issuance of loan creation and treasury bills which are later discounted. He said:
<blockquote>
The new salaries will also place civil servants in better positions to borrow in the US dollar, which will drum up the electronic US dollar as banks draw more income in the form of interest rates and charges.
The severity of the loans on civil servants and of course other workers from the private sector are centred around the fact that they don’t generate foreign currency.
In the absence of figures of the US dollar balances in the government purse, one can only predict that the new salaries can be destabilising because they are quite significant.
</blockquote>
Since its re-introduction after ten years of a multi-currency system, the Zimbabwe dollar’s value has plunged dramatically.
On 21 March 2023, the official exchange rate was US$1: ZWL$915.
More: <a href="https://zero.pindula.co.zw/">Pindula News</a>

Productivity Only Way To Break Zimbabwe's Currency Cycle - Gift Mugano

The Zimbabwe Dollar is now technically dead and this will be followed by a USD cash crunch, economists have warned.
Economics Professor Gift Mugano has said the Zimbabwean economy has already attained the peak of dollarisation as US dollar transactions are now around 80 percent.
Speaking during an interview with <a href="https://www.businessweekly.co.zw/zim-heads-for-another-painful-currency-cycle/">Business Weekly</a>, Mugano observed that the economy could be heading towards another “painful currency circle” that could have serious implications on investments and confidence. He said:
<blockquote>
If you look at all indicators available, that is, the percentage of transactions in US dollars and the percentage of loans in US dollars, I would argue that we have already attained the peak of dollarisation.
You agree with me that at least 80 percent of loans and transactions are now in US dollars.
Some sectors such as pharmaceuticals have reached a 100 percent level of transactions in US dollars.
Going forward, I doubt if we can make further significant gains as far as the level of dollarisation is concerned.
Rather, I see the economy driving back to the Zimbabwe dollar. In simple terms what I am saying is that we are in the 2013-2018 replay.
</blockquote>
Mugano warned that the banking system and Government, combined, were facilitating a process for the creation of “fake” US dollars or US dollars in RTGS.
He said this is being done through the process of issuance of loan creation and treasury bills which are later discounted. Said Mugano:
<blockquote>
When loans are issued the bank is anticipating income interest rate and associated bank charges yet the borrower is not generating foreign currency, that is, through exports or international consultancy.
Likewise, when the Ministry of Finance and Economic Development issues treasury bills in US dollars which are later on discounted they are technically printing money that is not backed by hard notes in USDs.
This process results in the creation of USD in RTGS which I call fake USDs. To date, our banking system has an estimated figure of US$1,5 billion of USDs in RTGS platform, that is, fake USDs, while the real hard notes are around US$1 billion.
This is the premise of my argument that the Zimbabwe dollar is on its way back.
</blockquote>
An economist with a State-owned financial institution told Business Weekly that the Zimbabwe dollar “is technically dead”, adding:
<blockquote>
I think the Zimbabwe dollar will be lost now, but it will be short-lived.
This will be followed by a US dollar cash crunch down the road, and we begin all over again.
</blockquote>
In 2009, the government abandoned printing Zimbabwean dollars entirely due to hyperinflation and adopted the use of foreign currency in all local transactions.
In early 2019, the Reserve Bank of Zimbabwe (RBZ) announced plans to bring back the Zimbabwe dollar as legal tender.
Since its re-introduction, initially as bond notes, and then as RTGS dollars, the Zimbabwe dollar’s value has plunged dramatically.
On 21 March 2023, the official exchange rate was US$1: ZWL$915.
More: <a href="https://zero.pindula.co.zw/">Pindula News</a>

"Zimbabwe Dollar Technically Dead"

The Minister of Finance and Economic Development Mthuli Ncube said that the government will maintain interest rates at par with inflation to promote the use of the Zimbabwe dollar in local transactions.
Ncube told the <a href="https://www.sundaynews.co.zw/fresh-moves-to-promote-use-of-local-currency/">Sunday News</a> that despite the rise in the use of US dollars in local transactions, nothing has changed in terms of the government’s focus on promoting the Zimbabwe dollar. Said Ncube:
<blockquote>
We are now maintaining interest rates that are at least at par with inflation. Our preference is for positive interest rates, that is what gives currency value. 
Maintaining positive interest rates is one way to maintain the value of the Zimbabwe dollar.
When individuals transact on a day-to-day basis using their mobile platforms, the mobile platform is basically the Zimbabwe dollar, which continues to be used widely. 
Some of the taxes that are collected are paid in Zimbabwe dollars. Then there is demand for those Zimbabwe dollars.
This is a policy that we have in place and it will continue. Nothing has changed in terms of focus on promoting our currency.
</blockquote>
The Zimbabwe National Statistics Agency (ZimStat) recently revealed that percent of local transactions are now in US dollars, with the remainder in local currency.
Furthermore, allocations from the Reserve Bank of Zimbabwe (RBZ) foreign currency auction system have also declined, showing reduced demand for USD.
Ncube said partial dollarisation has helped the country circumvent sanctions which are making it difficult for the country to access affordable loans from international financial institutions (IFIs). He said:
<blockquote>
But because of the sanctions on Zimbabwe, we cannot access credit lines abroad easily.
This then compels us to find ways to ensure that US dollars are available for companies to harness and invest locally.
That is the reason why we are allowing US dollars to circulate. We are circumventing a constraint that we have.
We also subject our domestic currency to the full monetary policy framework.
That is why we have the Monetary Policy Committee, which makes sure that we do not allow money supply, the Zimbabwe dollar, to get out of control.
</blockquote>

Mthuli Says Govt To Maintain Interest Rates At Par With Inflation

Economic commentators say the government should do more to support the Zimbabwe dollar to hold its value alongside the US dollar.
Policy measures introduced by fiscal and monetary authorities are to blame for the waning use of the local currency, several economic observers who spoke to <a href="https://www.businessweekly.co.zw/zimdollar-use-wanes-what-needs-to-be-done/">Business Weekly</a> have suggested.
Last week, the Zimbabwe Statistics Agency (ZIMSTAT) revealed that more and more economic agencies are now using the US dollar for transactions.
The Zimbabwe dollar has been losing value since it was reintroduced in 2019, and this year alone, it has lost 16 percent of its value on the official foreign currency auction system.
Trigrams analyst, Walter Mandeya, said the declining use of the Zimbabwe dollar is a result of several factors. He said:
<blockquote>
[These factors] include a high level of informal cash trading, shortage of ZWL cash available through the banking system (due to unreasonably low limits), inversely the ready availability of USD cash, the high velocity with which the USD moves through the economy in comparison to the ZWL, pricing that discounts USD cash, to mention a few.
We believe that both currencies can co-exist, but the government has to actively encourage the use of the ZWL through incentives, rather than punitive measures.
There is a need for further innovation by both government and the private sector to bring greater confidence in the intermediation role of the formal financial system between these currencies.
Government will need to enact specific laws that add to the protections given to savers and formal intermediates around the use of this dual currency system for the ratios to skew back in favour of the local currency.
</blockquote>
Economic analyst, Kudakwashe Mugova, said the decision to steeply increase interest rates and restrict stock market activities among others discouraged the use of the local currency.
He argued that using US dollar cash is now more attractive than the local currency which is associated with several tax and transaction charges.
Another analyst, Prosper Chitambara, said high levels of inflation forced economic agencies to prefer to transact in a more stable US dollar. He added:
<blockquote>
We need to sustain the reform agenda that government has been implementing, enhance the efficiency of public spending, liberalisation of the foreign exchange market.
I think once we continue on that path, I think that should have a more significant effect on de-dollarising.
</blockquote>
Another economist, Reneth Mano, urged both monetary and fiscal authorities to “embrace global best practice in managing macroeconomic stabilisation crisis.”

Govt Urged To Encourage Use Of Zimbabwe Dollar Through Incentives, Not Penalties

A former member of the Reserve Bank of Zimbabwe’s Monetary Policy Committee (MPC), Eddie Cross, on Wednesday warned that the current exchange rate stability on the parallel will be short-lived.
Cross said the stability of the Zimbabwe dollar is largely a result of its shortage in the market and once the government starts paying contractors and suppliers, the local currency will respond.
He said the only solution to the local unit’s volatility is to liberalise the market for the local currency. Said Cross:
<blockquote>
The current shortfall of domestic supplies of the local currency has been due to the measures adopted by the government where the government has halted payment to suppliers of services and goods. The government has also tightened up money supply through the reserve bank.
This has resulted in a shortage of local currency and electronic currency. This has had an immediate effect on slowing down speculation in the Zimbabwe dollar against the US dollar (US$) and as a result, the local currency has strengthened on the parallel market.
However this is not going to be long-lived, the government has to return to meeting its obligation of paying contractors and suppliers, and it is in the process of doing that.
Once these payments resume we are going to see a resumption of activity on the parallel market for the local currency.
The only serious solution to this problem is to liberalise the market for the local currency.
This will, in fact, provide a long-term solution to the problems we are confronting.
Anything else, we are just dealing with the symptoms and not the fundamentals.
</blockquote>
Africa Economic Development Strategies executive director Gift Mugano also said the stability of the Zim dollar is false and unsustainable. He said:
<blockquote>
The shortage has managed to hold the rate at a stable position but this shortage of the Zimdollar is false stability.
It is false stability because it is fragile and dangerous since it cannot sustain, and soon the rate will run away.
We are also fast dollarising as a number of companies in the private sector have begun pricing in US$ and the Zimdollar has already been relegated.
Even local councils and some government departments such as the passport offices are pricing strictly in USD.
Demand has taken a nosedive as customer traffic has declined.
</blockquote>
The latest foreign exchange weighted average rate announced by the RBZ on Tuesday is Z$604 per dollar, with businesses allowed to add a 10% markup in pricing goods and services.
This brings it close to the parallel market rate of between Z$650 and Z$800 per greenback. | <a href="https://www.newsday.co.zw/local-news/article/200000494/exchange-rate-stability-false-economists-warn">NewsDay</a>

Economists Say Zimdollar Exchange Rate Stability Is False

The Zimbabwe dollar is showing signs of stabilising, with the gap between the official and parallel-market exchange rates closing and inflation easing.
Speaking to <a href="https://www.bnnbloomberg.ca/wild-currency-ride-show-signs-of-settling-down-in-zimbabwe-1.1819041">Bloomberg</a> by phone, Harare-based economist and a member of the Reserve Bank of Zimbabwe’s monetary policy committee (MPC), Persistence Gwanyanya, said:
<blockquote>
We have basically converged with an acceptable premium between the alternative and interbank rates. The markets are at equilibrium.
</blockquote>
The latest foreign exchange weighted average rate announced by the RBZ on Tuesday is Z$604 per dollar, with businesses allowed to add a 10% markup in pricing goods and services.
This brings it close to the parallel market rate of between Z$650 and Z$800 per greenback.
Since May, the government has unveiled a raft of measures which include issuing gold coins, legalising the use of the US dollar and a brief ban on bank lending in a bid to stabilise the local currency and arrest runaway inflation.
Gwanyanya said with the currency markets stabilising, the central bank now expects businesses to begin cutting prices. He said:
<blockquote>
It is inescapable. The next wave is that of price reductions and that will cement the stability.
</blockquote>
Gwanyanya also said the RBZ won’t rush to cut its key interest rate, currently the world’s highest at 200%, as doing so will reverse the gains made so far.
Meanwhile, Lloyd Mlotshwa, who is the head of research at IH Securities, a Harare-based brokerage firm, said it is unclear whether some of the measures imposed to bring the exchange rates in line are sustainable. He said:
<blockquote>
The convergence has been achieved by punitively constricting local-currency liquidity, that is by stopping government contract payments, increasing interest rates to 200% and taxes on capital markets.
</blockquote>

Zimbabwe Dollar Shows Signs Of Stabilising

A shortage of Zimbabwe dollars has hit the market after the government suspended payments to its suppliers and payouts to contractors.
Rising inflation and a volatile exchange rate prompted the government to suspend payments to its suppliers to enable Treasury to investigate those suspected of pegging prices using the parallel market exchange rate.
The government also suspended payouts to contractors to control money supply and introduced gold coins to mop up excess liquidity on the market.
However, this inadvertently resulted in a liquidity crunch which in turn reduced the demand for goods and services.
Speaking to NewsDay, an economist, Gift Mugano, said that a continued shortage of the local currency could paralyse service delivery. Said Mugano:
<blockquote>
The government closed the tap on liquidity, which further confirms the long-held belief that government is the biggest driver of inflation.
So now that they have stopped pumping money into the market, the results are clear. 
Service providers play a very important role, so withholding funds is just a disaster for service delivery. The situation only indicates bankruptcy.
In future, companies whose payments have been delayed will refuse to do business with the government and this will result in a total collapse of public services and the projects that the government is working on.
So now that they have stopped pumping money into the market, the results are clear. Service providers play a very important role, so withholding funds is just a disaster for service delivery.
The situation only indicates bankruptcy. In future, companies whose payments have been delayed will refuse to do business with the government and this will result in a total collapse of public services and the projects that the government is working on.
</blockquote>
Confederation of Zimbabwe Industries (CZI) president Kurai Matsheza bemoaned the suspension of payments to government contractors saying it is negatively affecting production. Said Matsheza:
<blockquote>
What it means is less cash in the markets, and less product off-take so it means production will go down because companies can’t produce stock as they have no funds.
We, however, hope that this would be temporary and not a long-term solution so that business goes back to normal.
</blockquote>
More: <a href="https://www.newsday.co.zw/local-news/article/17073/zimdollar-shortage-hits-market">NewsDay</a>

Zimdollar Shortage Hits Market

The Reserve Bank of Zimbabwe (RBZ) says gold coins that were announced last week will be bought using both foreign and local currency (Zimbabwe dollar).
RBZ Governor John Mangudya said the gold coins will be introduced into the market mid-this month.
Speaking in an interview with The Sunday News, Mangudya said the coins will be exchangeable locally and outside the country.
Mangudya said authorities have already engaged international financial partners on the soon-to-be-introduced coins. He said:
<blockquote>
Basically, the gold coins will be an instrument for storing value and they will be purchasable in both foreign and local currency.
Once minted they will be distributed by Fidelity Printers and Refiners, local banks and international banking partners that we will announce in due course.
These gold coins will be used both locally and internationally because we have engaged with international banking partners.
What I must emphasise is that gold is gold and it has an international value.
</blockquote>
Mangudya said those who will purchase the coins will also get bearer certificates. He said:
<blockquote>
Since these coins are essentially meant to store value they can be used for the purpose of trading and also can be used as collateral. The purchaser can also convert them to cash if need be.
Our starting point for purchases will be one ounce of gold which will be representing approximately 22 carats.
</blockquote>
Mangudya urged members of the public to disregard circulating images purporting to be the gold coins on social media platforms saying they are fake. He said:
<blockquote>
As we have said, these coins will be minted at Fidelity Printers, who will be in charge of the distribution together with the banks and international banking partners.
The images that have been circulating are fake and the public should stand guided.
For now, Fidelity has been given the green light to start minting the coins so we expect that the coins will be available in the market by mid-July.
</blockquote>
<h4>More: <a href="https://www.sundaynews.co.zw/date-set-for-gold-coins-rollout/">The Sunday News</a></h4>

Gold Coins Will Be Purchased Using Both Forex And Zimdollar - Mangudya

Some wholesalers in the country are reportedly no longer accepting the Zimbabwe dollar and insisting on payments in foreign currencies only.
The local currency is shedding value on a weekly basis on both official and unofficial markets.
This week, the Zimbabwe dollar is officially trading at ZWL$350 against the US Dollar while on the parallel market the exchange rate is above ZWL$600.
Speaking in the National Assembly on Wednesday, Rushinga legislator, Tendai Nyabani (ZANU PF), said:
<blockquote>
We have wholesales like National Foods, Gains and others; we have noted that these companies are receiving money from the RBZ (Reserve Bank of Zimbabwe) so that they assist people but I have noted that they are not taking RTGs and local currency but they only want US dollars.
We have noted that people have to go to the black market to procure US dollars so that they go and buy from these wholesalers.
</blockquote>
In his response Finance and Economic Development deputy minister, Clemence Chiduwa said they have also received similar reports. Said Chiduwa:
<blockquote>
Indeed, it is very true that we are receiving reports regarding wholesalers and such business entities which come to the auction.
They get money to buy their goods. Such business entities, upon receiving money from the RBZ, then sell their goods in US dollars and do not take local currency.
Working together with the Financial Intelligence Unit, our Ministry has been seized with the issue.
As of Friday last week, we investigated big shops, pharmacies, and some retailers. Out of the 28, those who were complying with the exchange rate were only 11, which means that we have a lot of violations.
The FIU on its own does not have the capacity to cover Zimbabwe as a whole. At the moment, we want to work with the National Economic Inspectorate and different law enforcement agents so that we cover the whole country.
</blockquote>
Meanwhile, former Finance Minister, Tendai Biti urged the Government to abandon the auction system, saying it has become a source of arbitrage. Said Biti:
<blockquote>
The black market rate is now between ZWL$650 andZWL$700 but the auction is around ZWL$350.
Why not just remove the auction so that we do not have arbitrage and the ZWD will find its own resting place without the arbitrage of the auction.
</blockquote>
<h4>More: <a href="https://cite.org.zw/wholesalers-reject-inflation-ravaged-zim-dollar/">CITE</a></h4>

Wholesalers Reject Zimbabwe Dollar

Minister of Finance and Economic Development, Mthuli Ncube, has pleaded with Zimbabweans to embrace all currencies including the Zimbabwe dollar considering that the country is under sanctions.
Speaking on the sidelines of the ZANU PF Bulawayo Province National Cell Day on Saturday, Ncube said the country will attain a positive economic growth rate despite sanctions-induced challenges. He said:
<blockquote>
As things stand, it’s very important for us to embrace all currencies, especially the local currency.
As a country that is under sanctions, it is very critical for us to do that because we have to harness the hard currency that is in the local market.
</blockquote>
Ncube said the country will achieve a positive rate of economic growth this year following a 7.8 per cent growth recorded in 2021. Said Ncube:
<blockquote>
We are pleased that we are on course again this year to realise a positive rate of growth.
As you know, last year our rate of growth was 7.8 per cent, and this year we expect a positive rate of growth again.
All figures from the IFM and the World Bank are pointing to a positive rate of growth.
… Inflationary challenges caused by imported inflation and the parallel market are real.
However, these are challenges that we have to deal with head-on as a country in order to prevail.
</blockquote>
<h4>More: <a href="https://www.zbcnews.co.zw/zimbabweans-urged-to-embrace-local-currency/">ZBC News</a></h4>

Mthuli Urges Zimbabweans to Embrace All Currencies

Finance and Economic Development Minister Mthuli Ncube has said the Zimbabwe dollar is in short supply and its value is being distorted by speculative behaviour.
Ncube made the remarks during a question-and-answer session at the weekly post-Cabinet media briefing in Harare on Tuesday. He said:
<blockquote>
The Zimbabwean dollar is in short supply. If you got 0% growth in the money supply, then this currency is not in abundance, but actually in short supply.
So, what is driving the exchange rate is speculative behaviour in some of the monopolies.
</blockquote>
Ncube refuted claims made by former Finance Minister Tendai Biti last week that the Government was printing money to fund infrastructure development projects. Said Ncube:
<blockquote>
The government has taken steps to make sure that in its financing of necessary infrastructure development, it does not contribute to exchange rate volatility, indeed, to inflation acceleration.
We have taken two critical steps. One is to pay contractors using the foreign formula, 50% in US dollars and 50% in Zimbabwe dollars.
We have taken those actions and we have a committee between Treasury and the central bank which is called the liquidity committee, which manages the liquidity situation in the entire economy.
</blockquote>
Last week the Zimbabwe National Statistical Agency (ZimStat) announced that the country’s year-on-year inflation had shot to 131.7% up from 96.4% in April.
Meanwhile, the official exchange rate, as announced by the Reserve Bank of Zimbabwe (RBZ) on Tuesday, is now US$1:ZWL$308.
<h4>More: <a href="https://www.newsday.co.zw/2022/06/zimdollar-in-short-supply-mthuli/">NewsDay</a></h4>

Zimbabwe Dollar In Short Supply, Says Mthuli Ncube

Renowned economic commentators, Gift Mugano and Anthony Hawkins have urged the Government to accept that the Zimbabwe dollar has been rejected by the market and re-dollarise the economy.
This comes as annual inflation rose to 131.7% in May, from 96% in April, according to the Zimbabwe National Statistics Agency (ZimStat).
The local currency has also depreciated against the United States dollar on the official market, falling to US$1:$290 by Tuesday, compared to US$1:$258 the previous week.
Mugano projected that the domestic currency will dead by June this year, adding that the Government itself is rejecting the Zimdollar and has opted for the US dollar. Said Mugano:
<blockquote>
We are increasing our debt and we won’t be able to defend our currency. Even the government does not want to use its own currency.
It paid bonuses in US dollars, it is paying COVID-19 allowances in US dollars, and tollgates are now paid in US dollars.
We are not qualified to fight for the Zimbabwe dollar because the government itself wants the USD.
In fact, the market has dollarised, we are at a funeral, and we are going to the grave to bury the Zimbabwe dollar.
</blockquote>
Mugano said when the country de-dollarised in 2019, after a decade of a multi-currency system, the economy was not ready for the local currency. He said:
<blockquote>
The strength of the currency is reflected in its productive capacity. You do not go and support the local currency at a rally and campaign for it, you need production.
The second aspect is you must have fiscal consolidation. You must not have debt because when you have a growing debt then you also have vulnerabilities in the economy when the currency is attacked.
</blockquote>
Hawkins argued that dollarisation would be painful but it is the only way to tame runaway inflation. He said:
<blockquote>
The public doesn’t want to hold the Zim dollar. Yes, dollarisation would be painful, no doubt. But will it be more painful than an inflation rate of 400%?
The opponents of dollarisation will tell you that this is because saboteurs are destroying the local currency. That is not the case.
People are acting rationally, they are trying to protect their livelihoods, they are trying to protect their pensions, and they are trying to protect their savings from the predatory policies that are being followed at the moment.
The exchange rate is a reflection of what is happening in the economy.
</blockquote>
Another economist Persistence Gwanyanya, however, warned against full dollarisation. He said:
<blockquote>
Every one of us would want some dollars in his pocket now and every business may want to have the economy dollarised, but it is not the most effective currency option.
Dollarisation is costly. The Justice Smith Commission established that we need to compensate about $5 billion for the loss that occurred in 2009.
Right now we have got about $277 billion in the accounts. When we dollarise we need to first convert all those into US dollars or people will have to lose that.
</blockquote>
<h4>More: <a href="https://www.newsday.co.zw/2022/05/zimdollar-dead-by-next-month/">NewsDay</a></h4>

"Zimbabwe Dollar Dead By June"

The Confederation of Zimbabwe Industries (CZI) has reaffirmed its sentiments regarding what it called “the deteriorating currency situation” following condemnation by the Reserve Bank of Zimbabwe (RBZ).
On Friday, 22 April, CZI released its position paper where it urged the RBZ to suspend the foreign currency auction system and fully liberalise the foreign exchange market after the Zimdollar fell to $350 against the US dollar on the parallel market.
In his response to the CZI position paper on Saturday, 23 April, RBZ Governor John Mangudya said CZI was misinformed and the paper should be disregarded.
Mangudya insisted that the foreign currency auction system will remain in place because suspending it would cause shortages of goods on the market and abet inflation.
However, on Sunday, 24 April, CZI president Kurai Matsheza said there is a need to find common ground, otherwise, if the status quo is maintained, some companies could collapse. Said Matsheza:
<blockquote>
I think the route of discussion and engagement should be open and we all are really positive that these engagements will take us forward.
I don’t think the authorities will not listen to us. They may have a position, but I am sure that position can be debated and common ground can be found.
I am sure they will listen to what we have highlighted in that paper and they will engage.
We are not saying that they can adopt 100% of the recommendations, some of them can be picked, but I am sure that common ground can be found.
I am sure some will have difficulty continuing operating, it is going to be difficult.
But, look, the situation has been difficult for the Zimbabwean operating environment and I am sure some may actually find it difficult to continue.
</blockquote>
Here are the CZI’s recommendations outlined in its position paper released on Friday that seemingly angered Mangudya:
<ol>
<li>The auction should be suspended until the backlog is cleared and published as such</li>
<li>The Auction requires independent supervision along with the RBZ. This can include a Chartered Accountancy Firm and a professional registered auctioneer. This serves to address the rapid trust injection required to stabilize the Z$</li>
<li>Allow the currency auction to perform a price discovery role for the efficient allocation of foreign currency. This implies true Dutch Auction Principals as originally envisaged are implemented. The highest bids get full allocation within the regulated limits. This will curb abuse of the auction by unscrupulous players in the market, as well as eliminate the premiums and discounts being applied on the official rate. It would further increase flows of foreign currency into the formal system through the participation of willing sellers.</li>
<li>Auction what is adjudged independently to be available.</li>
<li>Foreign currency retentions must be financed through the budget.</li>
<li>Banks must encourage exporters to freely set reserve prices and sell their foreign currency on the auction system.</li>
<li>Policy must do away with the priority list and liberalise the market.</li>
<li>High level multi-sectoral meeting that must find a solution for agricultural financing. Banks CEO’s, RBZ, Ministry of Agriculture and Ministry of Finance must be closed in a room in Vic Falls until they find a solution that removes the burden of funding agriculture on printing money.</li>
<li>Tight control of money supply through holding constant the stock of money circulating in the economy and implementing reserve and broad money targeting.</li>
<li>Suspension of all quasi-fiscal activities which have an effect of increasing money supply growth and creating market distortions or arbitrage opportunities</li>
</ol>
<h4>More: <a href="https://www.newzimbabwe.com/zimdollar-crisis-czi-hits-back-at-mangundya/">NewZimbabwe.com</a></h4>

CZI Reaffirms Its Position On The Deteriorating Currency Situation

Economic commentator, Persistence Gwanyanya, who is also a member of the Reserve Bank of Zimbabwe (RBZ) Monetary Policy Committee (MPC) said the full liberalisation of the foreign exchange market will be difficult because the foreign currency is concentrated in the hands of a few.
Gwanyanya made the remarks while speaking to The Sunday Mail on Saturday partly in response to a proposal by the Confederation of Zimbabwe Industries (CZI) to scrap the foreign exchange auction system and fully liberalise the forex market.
In its paper released on 22 April 2022, the CZI proposed what it termed “a true liberalisation of the foreign exchange market where banks act as match-makers linking buyers and sellers of foreign currency”.
But Gwanyanya argued that the companies that accounted for 85 per cent of the US$9.7 billion foreign currency receipts that were injected into the economy in 2021 are also sitting on Zimbabwe dollar balances, hence they have no incentive to sell forex. He said:
<blockquote>
The challenge with our economy is that foreign currency is concentrated in the hands of a few.
Note, for example, that of the US$9.7 billion foreign currency receipts that were injected into the economy last year, US$6 billion was from exports.
And, of those exports, around 85 per cent are accounted for by a few commodities such as gold, diamond, platinum and chrome.
Hence full liberalisation cannot be an effective price-discovery system.
Why would companies like Mimosa or Zimplats, for instance, sell forex when they are also sitting on Zimbabwe dollar balances?
</blockquote>
In a statement released on Saturday, 23 April, in response to the CZI paper, RBZ Governor John Mangudya said that the foreign currency auction system will remain in place. Said Mangudya:
<blockquote>
The foreign exchange auction system remains in place and will not be suspended as doing so will cause shortages of goods in the market and abet inflation.
All foreign exchange accounts are safe and the bank has no reason or appetite to raid the accounts.
</blockquote>
This comes after parallel market rates rose to levels of around $350 to the United States dollar last week, while the official exchange rate was at $155.
<h4>More: <a href="https://www.sundaymail.co.zw/forex-auction-system-to-stay-rbz">The Sunday Mail</a></h4>

"Full Liberalisation Of Foreign Exchange Market Difficult"

President Emmerson Mnangagwa said that several big companies and banks face closure for their complicity in sabotaging their economy through manipulating the exchange rate and unjustifiably raising the prices of goods and services.
Addressing a ZANU PF rally held in Epworth National Assembly Constituency on Saturday to celebrate Zalerah Makari’s by-election win, Mnangagwa said the companies and banks, which he did not name, were working with hostile foreign governments to weaken the Zimbabwe dollar. He said:
<blockquote>
We have a challenge in our economy, especially around prices and exchange rates. 
We are working out a solution, we are now closing in on companies that are behind what we have been witnessing lately.
These economic players are not acting alone, they are being sent by foreign countries hostile to Zimbabwe to weaken our local currency.
So we are devising methods to deal with them, we will close some big companies and banks. These will be announced in due course.
</blockquote>
Over the past several weeks, the Zimbabwe dollar has been depreciating against major currencies on the parallel market resulting in a jump in prices of foodstuffs including bread, cooking and mealie meal among others.
<h4>More: <a href="https://www.sundaynews.co.zw/errant-banks-currency-manipulators-to-face-the-music-president/?_ga=2.91933786.1169608408.1650686036-1476354146.1643948410">The Sunday News</a></h4>

Mnangagwa Threatens Banks With Closure Over Depreciating Zim Dollar

President Emmerson Mnangagwa has said his Government will soon come up with measures that will ensure that the bulk of local transactions are done using Zimbabwe dollars instead of US dollars.
Addressing thousands of ZANU PF supporters in the Muzvezve constituency on Thursday, Mnangagwa said his Government will punish businesses that manipulate the Zimbabwe dollar and wantonly hike prices. He said:
<blockquote>
We are saying to our industrialists such as Innscor, that any investor who comes into the country should buy whatever he wants in Zimbabwe dollars.
We are putting measures to make sure that we deal once and for all with companies that are manipulating the local currency.
We also have locals who are indiscriminately raising prices, punishing the people but we are going to put measures that will ensure that our currency will be sought after and that the US doesn’t dominate.
</blockquote>
Mnangagwa mocked the United States of America and its allies, saying they have met their match in Russian President Vladimir Putin and the dominance of the US dollar globally will soon end. He said:
<blockquote>
On the issue of price increases, we used to have our own dollar. When we were sanctioned, our country’s currency was attacked by Western countries who have powers in terms of controlling money.
The money lost its value and we adopted the US dollar which we have since left behind. 
Now they (the Western world) have met their match in (Russian President Vladimir) Putin who is demanding payments for gas and oil in (the Russian currency) roubles instead of the US dollar that has governed global trade for the past 60 years.
Russia is a big country whose economy affects the world economy, there is now a new world order that includes Russia and China.
</blockquote>
On Friday, Russian Deputy Prime Minister Alexander Novak said several buyers of Russian gas have agreed to switch to payments in roubles, reported Reuters.
The announcement came after Putin said last month that buyers of Russian gas from “unfriendly” countries should pay in roubles.
The move was rejected by European Union authorities under the bloc’s sanctions regime against Moscow.
<h4>More: <a href="https://www.reuters.com/business/energy/russian-deputy-pm-says-several-buyers-agree-pay-roubles-russian-gas-2022-04-15/">Reuters</a></h4>

Companies Manipulating Zimbabwe Dollar To Be Penalised - Mnangagwa

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