The Zimbabwe national Chamber of Commerce (ZNCC) has asked Finance minister Mthuli Ncube to stop in the National Budget the use of bond notes and RTGS electronic balances, officially at par with the US dollar.
In the parallel market, bond notes are trading at a discount vis-à-vis the US dollar, and electronic balances are also exchanging at a discount.
Combined with the trade controls, the discounts have led to an uptick in inflation, which has raced to its highest in October since 2008 following a surge in prices of cooking oil, flour and sugar, the statistical agency Zimstat said, as the country faces a worsening dollar shortage.
Christopher Mugaga, an economist and chief executive of the ZNCC, said the currency conundrum is a reality as we move towards 2019.
“Zimbabwe’s bond note and RTGS 1:1 pegging against the US dollar is no longer sustainable. This is a confirmation that we are no longer dollarised as we were. What is now coming up is a local currency economy and we don’t expect a budget below $10 billion,” he said.
President Emmerson Mnangagwa has reportedly stopped Ncube from scrapping the quasi currency bond note and liberalise exchange controls, but enacted tough new measures prescribing 10-year jail terms for money changers. DailyNews