Zimbabwe business owners have pleaded with Parliament to ask the government to stop arresting unauthorised moneychangers and to re-open the bank accounts of companies accused of only accepting foreign currency.
This comes after Reserve Bank of Zimbabwe (RBZ)’s Financial Intelligence Unit (FIU) director-general Oliver Chiperesa said the unit had frozen bank accounts of 11 companies for trading exclusively in US dollars and refusing to transact in the new currency, Zimbabwe Gold (ZiG).
On Thursday, 18 April, sixty-five suspected illegal foreign exchange dealers operating on the streets of Harare were arrested and charged with contravening section 5(1)(a)(ii) of the Exchange Control Act [Chapter 22:05] as read with section 4(1)(a)(1) of the Exchange Control Regulations SI 109 of 1996 “Dealing in foreign currency”.
Confederation of Zimbabwe Industry (CZI) chief executive Sekai Kuvarika on Monday, 22 April, told parliament’s joint portfolio committees of finance and industry that arresting money changers will not arrest the ongoing slide in the value of ZiG on the parallel market. She said:
We urge authorities not to panic as the policy takes effect. The challenge of accompanying the policy with the police is that the police can replace the policy. The market will now work with the police instead of the policy.
They will work to ensure that the police do not catch them. We definitely do not support that we accompany our policies with the police.
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Owen Mavengere from the Institute of Chartered Accountants of Zimbabwe warned that arresting moneychangers causes panic. He said:
The parallel market and those dealers in the streets are a symptom of the problem. Sending the police doesn’t inspire confidence. So, we would rather have a situation where we handle the root cause. And use a soft approach.
Mavengere said the Government and government agencies should be the first to move from the dollar. Said Mavengere:
There must be a deliberate effort to make sure that the government starts to take the ZiG.
Ngonidzashe Mudekunye, chairman of Parliament’s Industry and Commerce Committee, said they welcomed the views from business owners about the new currency. He said:
We want to get feedback regarding the new policy, whether it’s working, and whether the industry has new suggestions that may be helpful, to ensure that this new monetary policy works.
We all want a stable currency. Everyone is crying for it. We got so many views; the market wants a stable currency. This is what we are going to suggest to them.
Reserve Bank of Zimbabwe (RBZ) governor John Mushayavanhu launched ZiG on 05 April 2024 and pegged it at the rate of ZiG13.56 to US$1.
Less than three weeks later, the ZiG is now trading at 20ZiG plus on the parallel market. The next stage for ZiG is introducing physical notes and coins to the public which is set for April 30.
