Businesses get US$19,8mln from auction system

Michael Makuza, Business Reporter

THE Reserve Bank of Zimbabwe (RBZ) has allotted US$19,8 million to businesses at the Foreign Currency Auction System this week while the local currency continues to lose grip against the United States dollar.

The official exchange rate at the forex auction system moved by US$0,05 to US$1:ZWL$912 from last week’s US$1: ZWL$907.

In its latest update, the RBZ said a total of US$17,2 million was allotted for the main auction and US$2,5 million for the Small to Medium Enterprises (SMEs).

Since the establishment of the platform in June 2020, the bulk of the foreign currency has been allotted towards the procurement of raw materials, machinery, and equipment.

A total of US$9,5 million went towards the procurement of raw materials while US$2,4 million was channelled towards the procurement of machinery and equipment in the main auction.

In the SME category, US$742 403 went towards raw materials while US$730 643 was for machinery and equipment procurement.

The Central Bank introduced the auction platform to improve productive sector accessibility to the much-needed forex.

The auction system continues to provide affordable and easily accessible foreign currency to the productive sector in a bid to reduce production costs and promote industrial growth as this reduces sourcing of forex from the illegal forex market, which manipulates exchange rates.