RBZ Governor says forex withdrawals are still permissible

Reserve Bank of Zimbabwe (RBZ) Governor Dr John Mangudya has cleared the air on a number of issues surrounding the abolition of the multi-currency system, among them clarifying that recipients of diaspora remittances and other foreign currency payments can still withdraw their money in hard currency.

Speaking in an interview, Dr Mangudya said non-governmental organisations, embassies and other foreign organisations will not be affected  and can continue paying salaries foreign currency.

Dr Mangudya also allayed fears of shortage of goods in stores as the interbank market will supply foreign currency for critical imports.

With effect from Monday, the Government declared the RTGS (now Zimbabwean dollar) as the sole legal tender, effectively abandoning the multi-currency regime, which Zimbabwe adopted in 2009 when hyperinflation rendered the Zimbabwean dollar worthless.

Government announced that the United States dollar, South African rand, Botswana pula and other foreign currency were no longer legal tender in Zimbabwe.

Meanwhile economists have implored businesses to stop pegging prices of goods and services against the value of the US dollar since the costs they incur are in local currency.

University of Zimbabwe former economics lecturer Professor Ashok Chakravarti said ever since the country dollarised, everyone has been benchmarking against the US dollar.

Professor Chakravarti said this is not the United States of America, but Zimbabwe.

He added that businesses thus need to start thinking in terms of the country’s local currency, with a view in mind that the costs are now local costs; workers are paid in local money and all the costs of production are in local money.