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THE Reserve Bank of Zimbabwe has called on business and individual traders to desist from externalisation of foreign exchange to foster desired macroeconomic objectives.
RBZ exchange control director, Mr Bekezela Mpofu, during an exchange control stakeholder awareness workshop in Mutare on Wednesday, said market discipline by traders was important especially under the current multi-currency system to maintain liquidity in the country.
“In our multi-currency environment money supply comes from cross-border inflows like exports, Diaspora remittances, foreign investment and external lines of credit.
“We are therefore engaging you to embrace market discipline and calling on you to desist from externalisation of foreign exchange and irresponsible use of foreign resources,” Mr Mpofu said.
He revealed that through the amnesty programme on exports and imports by the Central Bank last year, only $200 million has not been recovered out of $5.8 billion of uncovered transactions in both exports and imports which were recorded as at July 2014.
He said the successful amnesty programme was the Central Bank’s goodwill sign to stakeholders.
“Through the amnesty it was a sign of goodwill to urge people to stop transfer pricing which is under invoicing exports or over invoicing imports.
“The impact of this is a draining the market resulting in a liquidity crisis,” he said.
Mr Mpofu said Government was pushing for more Diaspora remittances to create more liquidity in the country.
He said effectively tapping of the Diaspora market RBZ would be the pacesetter on rational transaction charges through its subsidiary Home Link.
According to treasury reports last year, money directly from the Diaspora was $837 million. Government is targeting between $900 million and $1 billion this year.
In opening remarks by the RBZ Governor, Dr John Mangudya, read on his behalf, he cautioned business citing that the flouting of rules on exchange control exposed the economy to severe foreign exchange leakages through illicit capital flows.
“These incidences have largely manifested through smuggling of precious minerals, over invoicing of imports, under declaration and non-repatriation of export proceeds among other exchange control violations.
“The effects were demonstrated by the chronic market liquidity challenges being experienced,” said Dr Mangudya.
The Mutare RBZ stakeholder awareness workshop was the last after holding other similar meetings in Harare, Bulawayo and Masvingo.
Online Reporter