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Zimbabwe's new currency will be strengthened by fiscal discipline, Finance Minister Mthuli Ncube said on Monday, adding that the government would allow the RTGS dollar to fluctuate but would manage excessive volatility.
Ncube told Reuters that the central bank was paying dollars to a handful of commercial banks to allocate them to big business, as part of efforts to reduce the lack of liquidity that deprived the country of many basic necessities.
He said investors should not worry about the government's decision to increase Treasury bill issuance, as it has done in the past. "This faucet is closed for the moment," Ncube said.
Economists and business executives fear that if Zimbabwe does not reduce its borrowings, it could fuel inflation and a black dollar market, rendering the interbank foreign exchange market unnecessary as the central bank launched the last week.
Last week, Zimbabwe dropped a low-key 1: 1 dollar index for its surrogate bonds and electronic dollars, merging them into a lower-value transition currency called the RTGS.
The central bank sold dollars to banks at a rate of one US dollar at 2.5 RTGS, a level the bankers said was too low but Ncube deemed it appropriate to call it an "initial trigger point".
He refused to reveal where Zimbabwe had credit lines to launch the RTGS currency, or the size of these credit lines.
"In reality, we can not tell you how deep or shallow our pockets are. If the markets think you have too much money, they can bet saying we are going to make money with these guys, "he said.
Ncube added that the government was in talks with the International Monetary Fund in order to set up a program monitored by the staff and that it had sufficient resources to meet the demands for salary increase of the officials.
Ordinary Zimbabweans are not yet able to use the RTGS dollars from their bank accounts to buy dollars from banks, and bonds, which many businesses are reluctant to accept, are still in circulation. big companies are happy that they have been promised access to foreign exchange for critical imports.
"The devaluation was long overdue. The economy is in limbo and the RTGS can now play a role in boosting competitiveness, "said Anthony Mandiwanza, general manager of the Zimbabwean dairy and dairy company Dairibord.
"What is essential is that the government lives within its means, tightens and eliminates the budget deficit."
The last time Zimbabwe had its own currency, ten years ago, President Robert Mugabe's government turned to printing presses to finance higher wages for government employees and win the favor of the government. military, with disastrous economic results.
Mugabe's successor, Emmerson Mnangagwa, has promised a break with the past, but many Zimbabweans are wary after his government increased its borrowing ahead of last July's national elections and inflation reached its highest level. in 10 years in January.Mnangagwa, who replaced Mugabe after an army The coup of November 2017 hopes to bring the economy back to credibility and attract foreign investors, who were also deterred by violent measures security measures taken at last year's post-election protests and last month's protests against a sharp rise in fuel prices.
But the new RTGS currency has been criticized as saying that the level of 2.5 RTGS per US dollar is too much for the Zimbabwean unit.
A dealer in a bank operating in Zimbabwe's interbank market said the launch of the RTGS at $ 3 a dollar or more would have been better to encourage sellers in US dollars.
"There are a lot of buyers (in dollars) … but no sellers because the rate is not high enough," said the dealership. "The interbank system will eventually become redundant if the Reserve Bank does not allow the currency to trade freely."
It also seems that the central bank does not sell a lot of dollars. About $ 5 million changed hands on Friday, a senior central bank official told The Standard newspaper.
A Standard Chartered bank teller in Harare said his branch was not selling dollars to individuals yet and the queues at the downtown banks were no longer longer than normal.
Monday, a US dollar was sold on the black market for four dollars – individual accounts blocked for months because of chronic shortages of cash – against 4.2 million Friday, said traders.
"The big players keep their money, that's what's holding rates," said a currency trader at Eastgate Mall in Harare.
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