daniel chigunwe
Business Writer
The Confederation of Zimbabwe Retailers (CZR) is calling on the government to take a more active role in promoting the use of the Zimbabwean dollar (ZIG) as the country seeks to de-dollarize its economy.
While welcoming the recent move to back the ZIG with reserves, CZR president Denford Mutashu expressed concern that the government itself does not seem to trust the currency. This perception, fueled by the reluctance of many businesses to accept ZIG at a fair exchange rate, is creating an uneven playing field that disadvantages formal retailers, said Mutashu.
In a statement released Tuesday afternoon, Mutashu highlighted challenges faced byCZR members, who are unable to source goods competitively due to a procurement system that favours informal traders who can bypass regulations and deal directly in USD.
Additionally, a recent surge in USD-denominated employment costs is putting further strain on retailers, as employees seek to hedge against inflation,Mutashu pointed out.
The CZR is proposing a multi-pronged approach to incentivize ZIG usage. This includes encouraging manufacturers and suppliers to accept ZIG through mandates or incentives, treating ZIG on par with other currencies for tax payments, allowing government fees to be paid in ZIG, reducing the tax levied on ZIG transactions (IMTT), and finally, increasing tax brackets denominated in ZIG to make it more attractive for employee salaries.
These steps, according to the CZR, would not only boost confidence in the ZIG but also mark the beginning of a true de-dollarization process.
The Confederation believes that a stable ZIG currency is essential for ending the inflationary era, attracting foreign investment, and promoting economic growth.
The CZR’s call comes amid ongoing efforts by the Zimbabwean government to de-dollarize the economy. The success of these efforts will depend on regaining public trust in the ZIG and creating a level playing field for all businesses.
Bongani Ndlovu