Mugabe wants rand as currency

By Tawanda Karombo | IOL |

President Robert Mugabe has hinted that he would prefer the adoption of the rand in Zimbabwe despite the reluctance to adopt the currency from his government.

Mugabe, who turned 93 on Tuesday, said in a televised interview to mark his birthday that he had asked Finance Minister Patrick Chinamasa and central bank governor John Mangudya to explore use of the rand in Zimbabwe.

“We are in a multiple currency system. I don’t know why the finance minister and the Reserve Bank of Zimbabwe governor had not wanted to use other currencies such as the rand, the euro or the yen. They say we are going to do it,” said Mugabe.

The Confederation of Zimbabwe Industries has also insisted that Zimbabwe should use the rand to ease off liquidity challenges for manufacturing companies. A treasury official said the department had decided against full adoption of the rand because of fluctuations in value over the past few years.

Tourism incentive

Mangudya has previously said that the process to adopt the rand for use was cumbersome as it required that Zimbabwe first put into circulation its own currency.

The central bank last December introduced bond notes “ with equal value to the US dollar” but these have not helped ease the cash crunch in the country.

But strengthening tourism ties with South Africa has also prompted for incentives for usage or adoption of the rand, with tourism minister Walter Mzembi saying: “Measures to incentivise rand acceptance as transactional currency in the tourism sector”would boost the industry and the economy

Figures released by Statistics South Africa this week show that Zimbabwe was a major market for African tourist arrivals in South Africa last year. SA was also a major hub through which international tourist arrivals into Zimbabwe are facilitated and processed.

Mugabe has also blamed Zimbabweans for hoarding money instead of depositing it in the banks. But he said this was because there was no confidence in the financial sector.