Business / Economy
No Zim Dollar in the near future, says Mashakada
04 Apr 2013 at 17:40hrs | Views
Minister of Economic Planning and Investment Promotion Dr Tapiwa Mashakada has assured possible investors over continued use of the multi-currency system at least until 2016.
Mashakada allayed fears raised by possible investors over the possible change to the Zimbabwean dollar.
"You cannot introduce a local currency not backed by production as that would trigger hyper-inflation," Mashakada added.
On Wednesday, the RBZ governor Gideon Gono also said Zimbabwe is not yet ready to have its own currency adding the country had to first address its burgeoning trade deficit.
Gono said Zimbabwe remained heavily-dependent on the prevailing multi-currency system, dominated by the US$. There are worries that a President Mugabe led government might "prematurely" revert to the Zimdollar, if the leader wins the looming election.
However, during Zanu PF's annual congress, which was held in December last year, delegates resolved to reintroduce the redundant Zimbabwe dollar (Zimdollar) to run alongside the multi-currency regime in order to resolve the liquidity challenges besetting the country.
According to a list of resolutions passed at the 13th Zanu-PF national people's conference that was held four months ago, the party said it would lobby for the reintroduction of the valueless Zimdollar, arguing the current liquidity crunch was exacerbated by lack of a local currency.
Dr Gono, who seems to have had second throughts, recently made a complete U-turn over the Zimdollar issue. Speaking on Zanu-PF's recommendation for bringing back the Zimdollar in December last year, Dr Gono said the introduction of a reconstituted Zimbabwe dollar alongside the Chinese Yuan and other existing currencies is feasible and beneficial to the economy.
"The form and manner as well as the resumption of the proposed new Zimbabwe dollar or whatever it will be called will obviously take into account our national reserves in terms of strategic and precious metals such as gold reserves for back up," he said.
Early 2009 Zimbabwe government migrated from the local currency and started using the South African rand and the United States dollar as the official currency following the unpredictability of the Zim dollar.
Mashakada allayed fears raised by possible investors over the possible change to the Zimbabwean dollar.
"You cannot introduce a local currency not backed by production as that would trigger hyper-inflation," Mashakada added.
On Wednesday, the RBZ governor Gideon Gono also said Zimbabwe is not yet ready to have its own currency adding the country had to first address its burgeoning trade deficit.
Gono said Zimbabwe remained heavily-dependent on the prevailing multi-currency system, dominated by the US$. There are worries that a President Mugabe led government might "prematurely" revert to the Zimdollar, if the leader wins the looming election.
However, during Zanu PF's annual congress, which was held in December last year, delegates resolved to reintroduce the redundant Zimbabwe dollar (Zimdollar) to run alongside the multi-currency regime in order to resolve the liquidity challenges besetting the country.
According to a list of resolutions passed at the 13th Zanu-PF national people's conference that was held four months ago, the party said it would lobby for the reintroduction of the valueless Zimdollar, arguing the current liquidity crunch was exacerbated by lack of a local currency.
Dr Gono, who seems to have had second throughts, recently made a complete U-turn over the Zimdollar issue. Speaking on Zanu-PF's recommendation for bringing back the Zimdollar in December last year, Dr Gono said the introduction of a reconstituted Zimbabwe dollar alongside the Chinese Yuan and other existing currencies is feasible and beneficial to the economy.
"The form and manner as well as the resumption of the proposed new Zimbabwe dollar or whatever it will be called will obviously take into account our national reserves in terms of strategic and precious metals such as gold reserves for back up," he said.
Early 2009 Zimbabwe government migrated from the local currency and started using the South African rand and the United States dollar as the official currency following the unpredictability of the Zim dollar.
Source - Byo24News
