Forex situation dire as RBZ gives firms $370 million in 5 month

The Reserve Bank of Zimbabwe (RBZ) redistributed $370 million through the normal banking channels to production companies in the period August to December 2016, out of the $2 billion earned, showing severe foreign currency constraints, which are hampering local producers.

RBZ governor, John Mangudya said the remainder of the foreign exchange went to various transactions with a majority gobbled by current transactions through the usage of Visa cards and MasterCard.

Mangudya said the continued usage of these cards was contributing to the challenges in adequately allocating foreign exchange funds as they were not going back into productivity.

A number of local banks have restricted the use of Visa and MasterCard for local transactions. They have also put caps on foreign transactions using Visa and MasterCard.