Zimbabwe News and Internet Radio

‘Zim dollar not coming back’

By Ndakaziva Majaka

MUTARE – The Zimbabwe dollar (Zim Dollar) will not come back into circulation until the public regains trust in the eschewed currency, Bankers Association of Zimbabwe (Baz) president, Sam Malaba said.

Bankers Association of Zimbabwe (Baz) president, Sam Malaba
Bankers Association of Zimbabwe (Baz) president, Sam Malaba

Malaba told a Confederation of Zimbabwe Industries (CZI) conference yesterday the Reserve Bank of Zimbabwe (RBZ) was not going to reintroduce the shunned currency any time soon.

“An early re-introduction of the local currency is certain to cause panic withdrawal of all US dollar deposits — a stampede that will occasion a banking sector crisis and an economy-wide meltdown will ensue,” he said.

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Malaba, who is also Agribank chief executive, said a forced reintroduction of the local currency would leave the country in shambles thus making it nearly impossible to engineer sustained recovery.

Zimbabwe currently uses a basket of currencies, with government recently adding the Australian dollar, Chinese yuan and Indian rupee.

“We have a sound and perfectly capable RBZ governor who knows better than to return the Zim dollar because of the chaos it will cause to the economy,” Malaba said.

Malaba’s sentiments come in the wake of media reports that President Robert Mugabe’s government is weighing the reintroduction of the national currency as it struggles to meet its monthly wage bill.

The reports allege three members of Mugabe’s Zanu PF decision-making body said revival of the local currency would allow government to print money.

Fears of an imminent return of the Zimbabwe dollar gripped the market soon after formation of Mugabe’s government last year, but Finance minister Patrick Chinamasa assured the nation a local currency would only be introduced at an ideal time.

Malaba also said government needed to work together with the private sector, to attract foreign direct investment in key sectors of the economy, agriculture, mining, and manufacturing.

Figures released by responsible ministries show the agriculture sector requires about $2 billion for infrastructure rehabilitation; industry requires about $8 billion; mining sector requires about $7 billion;  while infrastructure (energy and power, roads, and rail; water and sanitation) need about $10 billion for capitalisation.

“In aggregate, this implies a total national requirement of about $27 billion — about, the amount that is required to finance the Zimbabwe Agenda for Sustainable Socio-Economic Transformation  as per the ministry of Finance and Economic Development,” said Malaba. Daily News