Mthuli Ncube scraps duty, fine-tunes forex auction to stabilize ZWL

Finance Minister Mthuli Ncube Thursday took several steps to stabilize the Zimbabwean local currency (ZWL).

These measures include scrapping duty on basic commodities imports, transfer of government loans from the Reserve Bank of Zimbabwe to Treasury, fine tuning of the Foreign Exchange Auction System, and allowing domestic interest rates above the devaluation rate.

In order to promote the supply of basic goods, all basics will no longer be subject to import licences nor import duties or taxes. Additionally, all proceeds from domestic sales in foreign currency will be exempted from the 15 surrender requirement.

Ncube underscored that domestic interest rates remain a variable of focus and are key tools to discourage speculative borrowing, reduce ZWL velocity, and promote stability. For this reason, all government agencies are instructed to collect their fees and levies in the local currency.

These measures come after the parallel market rates waning to over US$1 to ZWL 2500 in recent weeks and retailers and service providers responding with price hikes beyond the reach of many.

As part of its war against inflation, the government is determined to bring these steps that will stabilize the local currency and enhance access to basic goods