Zimbabwe News and Internet Radio

RBZ rules out adopting SA Rand

By Farayi Machamire

Reverse Bank of Zimbabwe (RBZ) governor John Mangudya has ruled out prospects of Zimbabwe adopting the South African rand as its anchor currency.

Reserve Bank of Zimbabwe Governor Dr John Mangudya
Reserve Bank of Zimbabwe Governor Dr John Mangudya

This comes amid frenzied social media posts claiming President Robert Mugabe and his South African counterpart, Jacob Zuma, were close to reaching an agreement to enable Harare to join the Common Monetary Area — made up of South Africa, Lesotho, Namibia and Swaziland.

Giving currency to the speculation has been Mugabe’s visit to South Africa to attend the 2nd Session of the South Africa-Zimbabwe Bi-National Commission.

Mangudya poured cold water on the speculation yesterday.

“These are fake news, which have their own objectives. So the answer, in simple terms, is that the multi-currency system is remaining in Zimbabwe,” he told the Daily News.

“That’s government’s position and that’s not changing. If that was true, don’t you think I would have sent out a statement? Haa, this fake news ka, ichakunetsai (fake news will confuse you),” he added.

Zimbabwe is South Africa’s fifth largest trading partner in Africa.

Prior to the June 2016 restrictions on imports that were meant to protect local industries, Pretoria exported more than R230 billion a year to Zimbabwe.

Currently, Zimbabwe has a huge mismatch between its exports and imports, with the latter dwarfing the former.

This has given rise to a painful liquidity crisis which is not being helped by the fact that Zimbabwe is using a firming US dollar as its anchor currency, making its exports uncompetitive.

Zimbabwe abandoned its own currency in April 2009 as runaway inflation rendered it worthless.

Having consigned its medium of exchange to the dustbins of history, Zimbabwe opted for a basket of currencies that includes US dollars, SA’s rand, the pound and the Botswana pula.

In light of the cash constraints, industry has presented proposals to government to make the rand the currency of choice because of Zimbabwe’s strong trade links with SA.

Mangudya said while the rand will continue to be part of the multi-currency system, the conditions on the ground do not favour its adoption.

“I said the rand is part of our multi-currency system. No one is refusing to use the rand in this country,” Mangudya told the Daily News.

“Number two, the rand is foreign currency; you need to export to get rands. Number three, you cannot export gold or tobacco with US dollars and then sell our US dollars at the Reserve Bank of South Africa to get rands; does that make sense? Now you are holding a weaker currency from the stronger currency.

“…what I am saying is that this was a question for 2009 when we dollarised the economy; that is when this issue should have been discussed. If we don’t have a facility from SA, a loan facility, how do we get the rand?

“So it means you need someone to give you the loan facility. And my understanding, during the Government of National Unity — my understanding was that there will be a $1 billion facility from SA, that’s what I thought, that’s what I heard but we did not get that facility.

“But if today there is a facility that comes it means the money will be in the market…And also if we are now using rands, it means we need to change US dollar accounts and if I am to change people’s money and give them a currency with a lower value; imagine you are an exporter, tomorrow I change your money and give you rands, do you think that is normal?

“Aaaahh no guys or even yourself, your personal accounts from US into rands hamundirove (won’t you beat me)?” he asked rhetorically.

Veteran economist, John Robertson, said Zimbabwe would need South Africa’s permission to adopt the rand adding Pretoria “would never give that permission if Zimbabwe’s behaviour seemed likely to undermine the stability of the rand.”

He said Zimbabwe would have to meet all the requirements of the Common Monetary Area, made up of SA, Lesotho, Namibia and Swaziland.

“This makes movements of capital and goods very mobile across the region, but disciplines have to be imposed by the SA Reserve Bank on the central banks of the member countries to keep the arrangements under control.

SA would have to impose the same disciplines on Zimbabwe.

“Current thinking in Zimbabwe suggests that the country would be highly unlikely to accept strong SA influence over Zimbabwe’s monetary policy.”

Chantelle Matthee, an analyst at NKC African Economics, said the real issue relates to how Zimbabwe is going to gain access to sufficient amounts of the currency for it to improve domestic liquidity, be it through a pegged arrangement or simply adopting a foreign currency as the sole exchange medium in the country.

“Adopting the rand should make trade between Zimbabwe and SA easier, but domestic production would still need to be ramped up for Zimbabwe to generate more rands through exports, and the mere adoption of the rand would not necessarily incentivise increased domestic output, especially if the currency comes under pressure and exporters prefer to be paid in US dollars,” she told the Daily News.

“Adopting the rand would also mean Zimbabwe gives up the independence of monetary policy and could also expose the country to shocks in South Africa, but aligning policy to that of its larger neighbour would not necessarily be a bad thing as it would be accompanied by increased stability and transparency.”

University of Zimbabwe economics professor Ashok Chakravarti said there were no major economic issues to ponder about in adopting the rand tomorrow.

“All it needs is a simple law, a statutory instrument from government with an exchange rate re-denomination of all US dollar balances, salaries and prices,” said Chakravati.

“The rand is also a non-convertible currency that will remain in the region and, therefore, cash will be maintained.” Daily News

  • This guy so haa

  • Why

  • inonzi reverse or reserve?

    • Dopori

      It was an inadvertent error and I understood it to be so, but even so it aptly describes the mode of our Reserve Bank – it is in reverse gear!

  • inonzi reverse or reserve?

  • Reverse bank chaiyo..

  • Kkkkk uchaburana nabhobho

  • Reverse???

  • Kutaura chokwadi Mr Governor tiri kuda mari inoshanda tanzwa nekubirwa nemumashop

  • Kikiki, for sure it’s a Reverse bank!!

  • Mukanyara hamugwaze

  • THIS GUY IS USELESS LIKE HIS UNCLE PRESIDENT

  • Thats how fools think.we need sa to invest in our country using hard currency which will taken out to buy expensive cars n the local employees are paid with bind paper money shame

  • Reverse Bank of Zimbabwe kkkkkkk pakaipa

  • Reverse Bank of Zimbabwe (RBZ) governor John Mangudya has ruled out prospects of Zimbabwe adopting the South African rand as its anchor currency.
    Reserve Bank of Zimbabwe Governor Dr John Mangudya
    This comes amid frenzied social media posts claiming President Robert Mugabe and his South African counterpart, Jacob Zuma, were close to reaching an agreement to enable Harare to join the Common Monetary Area — made up of South Africa, Lesotho, Namibia and Swaziland.
    Giving currency to the speculation has been Mugabe’s visit to South Africa to attend the 2nd Session of the South Africa-Zimbabwe Bi-National Commission.
    Mangudya poured cold water on the speculation yesterday.
    “These are fake news, which have their own objectives. So the answer, in simple terms, is that the multi-currency system is remaining in Zimbabwe,” he told the Daily News.
    “That’s government’s position and that’s not changing. If that was true, don’t you think I would have sent out a statement? Haa, this fake news ka, ichakunetsai (fake news will confuse you),” he added.
    Zimbabwe is South Africa’s fifth largest trading partner in Africa.
    Prior to the June 2016 restrictions on imports that were meant to protect local industries, Pretoria exported more than R230 billion a year to Zimbabwe.
    Currently, Zimbabwe has a huge mismatch between its exports and imports, with the latter dwarfing the former.
    This has given rise to a painful liquidity crisis which is not being helped by the fact that Zimbabwe is using a firming US dollar as its anchor currency, making its exports uncompetitive.
    Zimbabwe abandoned its own currency in April 2009 as runaway inflation rendered it worthless.
    Having consigned its medium of exchange to the dustbins of history, Zimbabwe opted for a basket of currencies that includes US dollars, SA’s rand, the pound and the Botswana pula.
    In light of the cash constraints, industry has presented proposals to government to make the rand the currency of choice because of Zimbabwe’s strong trade links with SA.
    Mangudya said while the rand will continue to be part of the multi-currency system, the conditions on the ground do not favour its adoption.
    Nehanda Radio Middle of Story
    “I said the rand is part of our multi-currency system. No one is refusing to use the rand in this country,” Mangudya told the Daily News.
    “Number two, the rand is foreign currency; you need to export to get rands. Number three, you cannot export gold or tobacco with US dollars and then sell our US dollars at the Reserve Bank of South Africa to get rands; does that make sense? Now you are holding a weaker currency from the stronger currency.
    “…what I am saying is that this was a question for 2009 when we dollarised the economy; that is when this issue should have been discussed. If we don’t have a facility from SA, a loan facility, how do we get the rand?
    “So it means you need someone to give you the loan facility. And my understanding, during the Government of National Unity — my understanding was that there will be a $1 billion facility from SA, that’s what I thought, that’s what I heard but we did not get that facility.
    “But if today there is a facility that comes it means the money will be in the market…And also if we are now using rands, it means we need to change US dollar accounts and if I am to change people’s money and give them a currency with a lower value; imagine you are an exporter, tomorrow I change your money and give you rands, do you think that is normal?
    “Aaaahh no guys or even yourself, your personal accounts from US into rands hamundirove (won’t you beat me)?” he asked rhetorically.
    Veteran economist, John Robertson, said Zimbabwe would need South Africa’s permission to adopt the rand adding Pretoria “would never give that permission if Zimbabwe’s behaviour seemed likely to undermine the stability of the rand.”
    He said Zimbabwe would have to meet all the requirements of the Common Monetary Area, made up of SA, Lesotho, Namibia and Swaziland.
    “This makes movements of capital and goods very mobile across the region, but disciplines have to be imposed by the SA Reserve Bank on the central banks of the member countries to keep the arrangements under control.
    SA would have to impose the same disciplines on Zimbabwe.
    “Current thinking in Zimbabwe suggests that the country would be highly unlikely to accept strong SA influence over Zimbabwe’s monetary policy.”
    Chantelle Matthee, an analyst at NKC African Economics, said the real issue relates to how Zimbabwe is going to gain access to sufficient amounts of the currency for it to improve domestic liquidity, be it through a pegged arrangement or simply adopting a foreign currency as the sole exchange medium in the country.
    “Adopting the rand should make trade between Zimbabwe and SA easier, but domestic production would still need to be ramped up for Zimbabwe to generate more rands through exports, and the mere adoption of the rand would not necessarily incentivise increased domestic output, especially if the currency comes under pressure and exporters prefer to be paid in US dollars,” she told the Daily News.
    “Adopting the rand would also mean Zimbabwe gives up the independence of monetary policy and could also expose the country to shocks in South Africa, but aligning policy to that of its larger neighbour would not necessarily be a bad thing as it would be accompanied by increased stability and transparency.”
    University of Zimbabwe economics professor Ashok Chakravarti said there were no major economic issues to ponder about in adopting the rand tomorrow.
    “All it needs is a simple law, a statutory instrument from government with an exchange rate re-denomination of all US dollar balances, salaries and prices,” said Chakravati.
    “The rand is also a non-convertible currency that will remain in the region and, therefore, cash will be maintained.” Daily N

    • Zvaiva nani dai akatoita ma accounts edu ma Rand account pane kumaita ma Bond accounts nxaaa

  • because they are benefiting from their useless bond notes. They are fuckoffs

  • They don’t want conditions attached

  • They do not like the idea because it will work and they won’t be able to steal as SA banks will be monitoring as well

  • No no no hell no.

  • It clearly was fake news, one could easily see from the dodgy online link that somebody cooked it up with the hopeless hope of influencing RBZ policymakers. It doesn’t work that way.

  • Munhu anenharo uyu

  • But what did you guys expect?l m not surprised.ZANU wants to keep printing those Bond Notes to fund their party and election campaign

  • I swear this clown& Gono are from the same whatsapp group!

  • Bba u are like gono hapana kana musiyano apa matadza endazvenyu kumba

  • Rand adoption idea gives all responsible authorities specifically zanu pf and RBZ employees a heart beating moment.The idea can bring some sanity to ordinary zimbabweans whilst bringing demise to illegal cash dealers.Lest we forget all Zanupf and RBZ employees are enemies of prosperity and are enjoying current economic situation in Zimbabwe hence for whatever reason they can’t support the Rand adoption idea.

  • Rambai kushandisa rand imi baba vanhu varikuguta nekuchinja mari mukapinza rand mhuridzavo dzavata nezhara siyai ma bond iwawa mhuri dzenyu dzigute dzedudzigovata nezhara

  • Blahblaha blah

    The point he is saying he is a failure like the top brass the US$ is also foreign currency like the rand you are you trying to fool?

    • Blahblaha blah

      correction: The point he is saying he is a failure like the top brass. The US$ is also foreign currency like the rand who are you trying to fool???

  • stupid

  • Reverse Bank, Chitima chirikudzosa marasha kuHwange.

  • ASI CHII NHAI

  • I remember the highly respected former governor strongly dismissing yhe coming of the USA dollar a month or before he gave up snd dollarised

  • That’s true my brother.

  • Why Mangundya, Why?

  • Reverse bank lol I’m dead😂😂😂😂

  • Ayas🙌

  • Whatever the case iwe Mangudya,kusvikira riini zvunhu zvakadi?

  • Rand wil penetrate and adopts itself

  • Ukataura chokwadi unosungwa kkk

  • I am an economist though but to me the adoption of the rand is the only sensible route which can help our economy boat not to sink deeper. Zim and SA enjoy good relations in terms of trade .We are importing a lot from SA the rand will help the business community to import and stabilise the regime price and take out the American dollar from the equation which has many Zimbos poorer everyday

  • Sometimes we need to put aside book theories and reality as reality
    Our economy needs partnership for now

  • face reality as reality

  • That’s the best idea to take the rand but you don’t want why are always against good development ? Ok go print your bond the result will come out.

    • Kkkkkkkkk ndisu tega tozvikuvadza rand torirambirei takarishandisa wani vanhu tine problem wataura idi

  • Apo the cost of living is getting steep and painful to the poor.chokwadi zvinhu zvirikukwira cascade from 40 cents to 55 cents in a week…gadzirikai them magadzirisa zvinhu

  • “Reverse” Bank? Quite true. Literally!

  • Contrasting , Pretoria statement Zim considering adopting rand

  • Amasela lawa nxi

  • Because the dumb ass RBZ is full of stupid pride given the fact that in his egoistical brains adopting the Rand for Zim wil effectively render him useles.He feels Great and in charge when he prints that yucky,siessy surrogate currency(bond notes,)Anyway what i love about my fellow Zimbabweans is that they always influence the market and soon market and demand forces will be unstoppable and people in particular and the market in general will eventually automatically REJECT the bond notes.

  • Utter rubbish. Mbiri yaChitsiga hanzi : Ndichakamira icho chatsva divi rose.”

  • I miss Kombo Moyana, and his Zim dollar. Ma sprouting Governors atisingazive kwaanobva argh zvinhu zvacho mahwani. Ma degree aya ndeekuruma muromo uchidzidza kana kuti vakapiwawo zvavo.

  • Because he and his dudes wont benefit from that

  • He is going the Gono way

  • Rand havaride vanozoba sei

  • Nothing gd comes frm this side of RBZ …and this Z…is still sounding evil.

  • Reverse bank ???? ha ha ha so true

  • All these guyz want is to see Zimbabweans suffer and ultimately rig election elections becouse its a common knowledge nobody loves them.Adopting Rand or not does not change Zanu pf’s splundering behaviour( all the $USD in Zim got them finished….All Gold reserves got them eaten by Zanupf…All them useless Bondnotes are in the hands of ZANU pf…So if the Rand comes what do you guyz expect? Prosperity,inflation down ?,money circulating in banks?,imi kaimi

  • RAND? vangatotaura nyaya dzekuti Iwe hauna kuliya Poison mumwe achiti ndakaliya poison ….mumwe nokoko achiti ndakavapa MaUnderware manyumbi mumwe nokoko arikuty wakaunza emubhero….imimi mati Rand kuunzwa nani?

  • For them to (Randarise ) they must give south African reserve bank Gold reserves from this end.Rand haringouye hakuna kana diamond,goridhe nyangwe bronze zvayo Ku reserve bank uko…zvakaliwa ngeZanupf

  • What about Pula

  • Nhai baba imi murikuti mungarohwa mukaisa mari dzevanhu mu Rand hamuna kurohwa wani pamakaisa mari dzavanhu mu bond nhasi uno ukapinda panotengesewa zvinhu unowana panemitengo mitatatu .Zvibrinani ndezvipi kuisa mutengo umwe chete we Rand.Honai mdara a quotation of usd190 equate B240 then transfer T270

  • yes they wil not allow it nokuti vari kutengesa mari muroad vanhu vavo..saka vanozoita sei…these idiots

  • This Mangudya guy is clueless..

  • Chitimkulu

    Is the president’s portrait supposed to be in every office of an establishment or at the front office only? Does this man speak from the front office?

  • Ayas these thieves ka

  • ……hah it was the best solution to cash shortages but alas they decide otherwise.

  • So is it better for u to change my us dollar in the bank and make it bond notes wht is it that u are trying to say here. Its better u change to rands than to bond its only u and your top aids who are getting hard dollors but all of us we are getting bond. The thing is u are cowards thats all

  • Apparently we want the white man’s culture, clothes, clothes,schools,way of life and green buck.We don’t want help from a black neighbor

  • “Gud job” my guy! 🤣🤣😂😂