Bulawayo forex discount deal not attractive

BULAWAYO residents have expressed mixed feelings over council's 50 percent discount policy for those settling their bills in foreign currency only as well as the municipality's plans to sell some residential stands in forex.

Bulawayo City Council started implementing a 50 percent debt cancellation policy only for those paying their bills in foreign currency on December 17. Council also said international organisations operating in the city are now required to pay for services in forex.

In interviews yesterday, Bulawayo residents said while they appreciate that council was taking measures to keep the municipality afloat, the new measures will not benefit the majority of residents who are struggling to make ends meet.

Bulawayo United Residents Association (BURA) chairman Mr Winos Dube described council's move as a gamble.

"I think this is 50/50 situation, council is trying to find means to survive but at the same time it would not get many takers as most people are not earning foreign currency but are paid in Real Time Gross Settlement (RTGS)," said Mr Dube.

"I'm also quite aware that most council service providers are demanding foreign currency, so the council is trying to survive in this difficult economic environment." He said the local authority should also incentivise residents who are not earning foreign currency as they also owe it.

Bulawayo Progressive Residents Association programmes coordinator Mr Emmanuel Ndlovu said demanding foreign currency as payment for residential stands will increase the gap between the rich and poor. He said council's 50 percent debt cancellation policy is unattractive considering the rates in the parallel market. Mr Ndlovu said council should have implemented a debt cancellation policy for those paying in bond notes or RTGS even if the discount rate was much lower.

"The 50 percent debt cancellation strategy is not attractive at all. It will not get many takers because at a 1:1 rate someone would rather change his or her foreign currency on the parallel market where the rates are higher and then clear their debts. Selling of stands in foreign currency will see a few locally based residents owning houses as most of them are not getting the hard currency," he said.

"A research that was conducted at the National University of Science and Technology (Nust) proves that most houses in the new suburbs are owned by diaspora based Zimbabweans with most of the occupants lodgers. So diasporans will continue to buy houses while locals will continue being lodgers."