Chronicle Editor
Mashudu Netsianda, Online Reporter
THE Zimbabwe International Trade Fair (ZITF) company board chair Mr Busisa Moyo has said adopting a framework that allows for a single reference exchange rate would be ideal for business as it will help in stabilising prices and incomes.
Lately, business leaders have noted with concern the weakening of the local currency against the United States dollar, which has been blamed for the erosion of incomes and the loss of purchasing power amid price escalation.
Foreign exchange rates volatility and the existence of an alternative market has tended to drive business operating costs up, as price indexing to the United States dollar has become rampant.
Addressing delegates during the ZITF International Business Conference (IBC) in Bulawayo, Mr Moyo said while the country continues to witness green shoots of the recovery on the economy, the issue of pricing and income stability can only be addressed through tackling multiple exchange rates, which have led to distortions and informalisation of currency market.
“We have red flags that we should be mindful of as we make our discussions in this conference. We are still yet to succeed in designing a framework that allows for a single reference exchange rate that allows for stability in pricing and incomes,” he said
“We’re still tackling the issue of multiple exchange rates which lead to distortion arbitrage and informalisation of currency market.”
Mr Moyo said a single formal reference rate foreign currency will ensure that the country attracts foreign direct investment, long term financing and ultimately improve social indicators to support a stable consumer class for business growth.
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Online Reporter