RBZ forex allotments reach US$4,1bn

Judith Phiri, Business Reporter

THE Reserve Bank of Zimbabwe (RBZ) has allotted over US$4,1 billion through the foreign exchange auction system since its introduction in June 2020 to December last year with the bulk of it channeled towards the importation of raw materials and machinery.

The auction system was established as a price discovery mechanism for the local currency as well as to avail the much-needed foreign currency to local companies for production at a time the country was experiencing foreign reserves challenges.

The willing-buyer-willing-seller platform is now also being used as the platform to determine the official exchange rate and it has helped keep the exchange rate in check.

Last year’s allocations stood at over US$680 million, according to the Central Bank.

In a statement on Monday, RBZ Governor, Dr John Mangudya said the bulk of the retail auction allotments was for payment for raw materials, machinery and equipment, with the remaining total allotments going towards payment for services.

“In line with its commitment to regularly keep the public informed of developments in the foreign exchange market, the bank hereby advises that the sum of US$3 909 195 was allotted to 228 beneficiaries under the retail foreign exchange auction during the month of December 2023 and the sum of US$12 830 473 was allotted to 263 beneficiaries under the wholesale foreign exchange auction during the month of December 2023,” he said.

He added that the total cumulative foreign exchange auction allotments since inception of the foreign exchange auction system in June 2020 stand at US$4 120 819 400.

He said the total foreign exchange payments for December 2023 were US$685 413 107 broken down as foreign currency accounts US$651 028 674, foreign exchange auction allotments US$16 739 668 and the interbank market US$17 644 765.

Dr Mangudya said the bulk of the retail auction allotments during the month of December 2023 at 58 percent was for payment for raw materials at US$1 489 281 and machinery and equipment at US$763 311, with the remaining 42 percent of the total allotments going towards payment for services atUS$474 514, consumables at US$556 276, retail and distribution at US$129 617, pharmaceuticals and chemicals at US$399 609 and manufactured goods at US$96 587.