Zimbabwe News and Internet Radio

Forex dealers begin to stew

By Nokuthaba Nkomo and Pauline Hurungundo

The hordes of illegal foreign currency traders who had made the streets of Harare their home are increasingly becoming a rare sight, as President Emmerson Mnangagwa’s abatement measures take effect.

File picture of forex dealers in Zimbabwe
File picture of forex dealers in Zimbabwe

As has accurately been reported by the Daily News over the past few weeks, Mnangagwa this week introduced temporary emergency policies to mitigate the country’s rampaging foreign currency black market.

The new laws prescribe a maximum 10-year custodial sentence for illegal foreign currency traders, with authorities empowered — through the Unexplained Wealth Orders Statute — to confiscate all ill-gotten wealth.

A survey by this publication revealed that as the law became operational on Monday, illegal foreign currency traders deserted their usual selling points.

However, the fears are that most of the illegal foreign currency traders have now started operating on their mobile phones, and through which they arrange to meet their customers at secret locations.

Two weeks ago, Mnangagwa warned that he would bring “grief” to all those who are involved in the illegal trade of foreign currency, as he tries to bring stability to the country’s wobbly economy which went into turmoil at the beginning of last month when the government unveiled a slew of unpopular measures.

“An unexplained wealth order is an order requiring the respondent to provide a statement setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made and explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met).

“The High Court must be satisfied that there is reasonable cause to believe that the respondent holds property and the value of the property is greater than US$10 000 or its equivalent,” read part of the measures contained in the Money Laundering and Proceeds Crime Act and Exchange Control Act statutory instrument that became effective on Monday.

The new law gives authorities the power to freeze any property suspected to have been acquired illegally.

The new measures come as Zimbabwe remains in the grip of a huge economic crisis which has seen the country slipping back to frightening levels similar to the disastrous 2008 hyper-inflationary era.

The country has, consequently, been experiencing acute shortages of foreign currency, which in recent weeks triggered shocking price hikes, shortages of essential medical drugs and basic consumer goods.

At the same time, the government’s recent austerity measures, which are seen as the first steps towards reviving the country’s economy, did not find resonance with the majority of fearful Zimbabweans. DailyNews