Chinamasa explains why there are cash shortages- says net is closing in on traders in reserved sectors

Finance Minister Patrick Chinamasa has blamed the government and unscrupulous traders for the current cash shortages.

In a ministerial statement yesterday, Chinamasa said the government was living beyond its means as employment costs and legacy debt were way beyond government revenues.

“Government funds its employees’ salary accounts through electronic transfers over the Real Time Gross Settlement (RTGS) platform,” he said. 

“On the contrary, employees would want to obtain physical cash from banks. 

“This misalignment is the greatest cause of queues at banks for cash as both the Reserve Bank and banks would be required to withdraw foreign exchange from their Nostro Accounts to meet cash demand.”

Chinamassa said the problem was being exacerbated by traders who were not banking their cash.

“This indiscipline is counterproductive and cannot continue to be tolerated,” he said.

“Money is like blood, it needs to circulate for the economy to survive. 

“Money should be circulating in order to deal with queues at the banks.

“To date, three traders have been hauled before the courts for not banking their sales proceeds in line with the laws of the country from as far back as June 2016.

“They have all pleaded guilty to the offence and they now await their sentences after the Easter holidays.”

Chinamasa also said the other major cause of cash shortages was that foreigners had entered into cash-generating businesses that are reserved for locals.

These include: transportation, passenger buses, taxis and car hire services; retail and wholesale trade; barber shops, hair dressing and beauty salons; employment agencies; estate agencies and real estates; bakeries; grain milling; tobacco processing; advertising agencies; and provision of local and craft, marketing and distribution.

“In Zimbabwe, the opposite is true and as a result we have noted with great concern the deliberate disregard to the laws of the land by these traders,” Chinamasa said.

“Such unscrupulous traders should not continue to enjoy the freedom of being in the reserved sectors without compliance.

“The net is closing on those players who continue to disrespect our laws.”

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