adminOliver Kazunga, Senior Business Reporter
THE introduction of bond notes will result in trade chain restoration which was lost at the adoption of a multicurrency system in February 2009, an official of the Directors’ Protection Council of Zimbabwe (DCPZ) has said.
Bond notes will start circulating at the end of this month with $75 million worth of the notes expected to be in the economy by December, according to the Reserve Bank of Zimbabwe.
In an interview in Bulawayo yesterday, DPCZ chief executive officer Mr Reggies Sibanda said the public should not be worried about the introduction of bond notes.
“As a country, we must embrace the bond notes in order to restore the trade chain. Consumers and retailers should not be worried about the bond notes as they will be at par with the United States dollar as well promoting discipline in trade,” he said.
“It is not the duty of the consumer to import and thus the consumer should not get worried about their introduction. For example, you find a vendor being worried about the bond notes.”
Mr Sibanda said the introduction of bond notes would also assist manufacturers and wholesalers as well as other players involved in international trade to reduce competition for foreign currency.
Industry through its representative body, the Confederation of Zimbabwe Industries (CZI), has thrown its weight behind the introduction of bond notes saying they will boost internal trade and ease the current cash crunch threatening the economy.
Speaking in Bulawayo during a roundtable on matters to do with business and the economy yesterday, CZI president Mr Busisa Moyo also backed bond notes.
“As CZI, we have come out to say that they will assist at least in terms of exchange because right now the people that should have been buying our cooking oil, buying these ox-drawn ploughs are in the queues; they cannot go and buy in the shop because they’re in the queue looking for money which they do not get,” he said.
“And this impacts on consumer expenditure; people cannot spend because they are unable to access cash. If we go into the festive season without a decent means of exchange, without decent access to cash, we will have a problem. So in so far as a medium of exchange, we really do not have any issues with bond notes, we see them as an improvement.”
Mr Moyo said although the use of mobile money transfer services and other electronic payment systems was being encouraged, not everyone was conversant with how they are used when transacting.
On foreign payments, Mr Moyo said companies continue to face challenges as they still find it difficult to make foreign payments.
“You can have a bank balance but that bank balance cannot be used to pay outside. You can have a million dollars in the bank today, but that million, you might not be able to use it to buy equipment or raw materials outside. It takes sometime because there is a shortage of Nostro balances,” he said.
In the 2016 mid-term monetary policy statement, RBZ Governor Dr John Mangudya said in order to deal with the current delays in the processing of outgoing foreign payments by banks, the central bank has managed to secure $215 million from international finance institutions to deal with the outgoing foreign payments backlog.
He said negotiations were also at an advanced stage to raise $330 million from regional sources to enhance production and liquidity supply in the country.
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