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Mnangagwa threatens to legislate against foreign currency use

by Staff reporter
02 Jun 2023 at 06:43hrs | Views
PRESIDENT Emmerson Mnangagwa has, in a yet-to-be-aired interview, declared Zimbabwe will continue using its waning currency despite it fast-losing value.

In snippets of the interview shared by his office Wednesday, Mnangagwa threatened to push for enactment of laws barring use of foreign currency, blaming sanctions for the continued decline of the ZWL.

A recent free-fall of the ZWL has seen government backtracking on last year's plans to further liberalise Zimbabwe's foreign exchange market.

Reserve Bank of Zimbabwe (RBZ) Governor John Mangudya's interbank exchange rate has remained a ceremonial entity, disregarded by ordinary citizens who opt for the parallel which offers better rates.

Mnangagwa's interview will be published by Third Eye and Brick by Brick, a magazine focused on developments being undertaken by his administration.

"Sanctions have succeeded in destroying the Zimbabwean currency. Carrying ZWL$2 billion to buy a loaf of bread was not feasible that is why we abandoned it and allowed multiple currencies to operate and that stabilised our situation (in 2009)," said Mnangagwa.

"There is no country that can develop without its own currency, so (have) we reached a stage now where we have our currency that is under serious attack.

"What we might do is legislate against foreign currencies to make sure we use our own currency. Our people must know our currency is there to stay, it must stick. Foreign currencies are not here to stay."

To arrest the crisis, Mangudya and Finance Minister Mthuli Ncube have introduced gold coins and much recently a gold backed digital currency.

Little has changed with inflation soaring and salaries losing value by the minute.

"We have consistently argued that de-dollarisation has failed and therefore government needs to dollarise while floating the ZWL, anything short of this will not work," said former Finance Minister Tendai Biti recently.

"We have also argued that the Central Bank has gone rogue and needs to be replaced by a currency board. The new measures will not stop RBZ from conducting quasi-fiscal activities or its illicit gold dealings.

"We say to them again dollarise and float the ZWL, scrap export surrender requirements and the auction system, pay workers and pensions in USDs, pursue fiscal consolidation, deal with corruption, deal with infrastructure, decarbonise and most importantly have a free and fair election."

Source - NewZimbabwe