Zimbabwe govt maintains tight monetary, fiscal measures

GOVERNMENT yesterday said it would continue with the tight fiscal and monetary policy measures that include increasing the retention on domestic foreign currency sales to 100%, among others.

According to a statement released by the Finance and Economic Development ministry, the 100%, retention on domestic foreign currency sales had resulted in domestic businesses accessing more foreign currency from the market and translating into additional United States dollar deposits in the banking system.

"In this regard, the government will continue with the tight fiscal and monetary policy measures that include promoting the use of domestic currency by using measures such as payment of corporate taxes and government agencies' fees in local currency, and additional measures are under consideration," the statement read in part.

It said Treasury would make sure that there is no backlog in the foreign currency auction system.

"Government will continue to support the auction with foreign currency and pay winning bids at the auction within 24 hours of award.

"In order to encourage banking of foreign currency which is mainly in the informal sector while promoting use of the local currency, government will continue promoting use of domestic currency by enforcing that all government agencies including parastatals will continue to collect their fees in local currency."

It also said payments to Zesa Holdings by non-exporters would continue to be made in Zimdollars.