Chinamasa tells senator: “Matanga zvinhu zvenyu zvekuti zvinofanira kuita mangwana”


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Q & A:

HON. SEN. CHIMHINI: My question is directed to the Minister of Finance. Minister, you have explained quite a lot about the cash crisis which we are experiencing but you have not indicated how soon we are going to get out of this mess because it is a pity to see people in bank queues and not getting their money. How soon are we going to get out of this mess?

HON. CHINAMASA: Matanga  zvinhu zvenyu zvekuti zvese zvinofanira kuita mangwana – [Laughter.] – At this point, all I can say is it is not easy to say clearly within what timeframe but I want to encourage Hon. Members. You see, it is a process and I am confident that when we follow the measures that we have taken; this problem will be behind us, but clearly we have until September/October for the issuance of bond notes which will go quite a long way to assist this problem.

You also need to know, like I mentioned earlier in answer to a question, that we are encouraging the use of plastic money. As I pointed out, within the past four weeks we have seen a 400% increase in the usage of plastic money, something that is very good. If a country has no banking system, meaning that all of us are not keeping our money in the bank, we have no economy. So, the measure we are taking is to encourage all of us to bank our money so that the financial system can operate efficiently and function. Circulation of money is the life-blood of an economy and what has caused us the problems is that the US$, which should be a medium of exchange is not circulating.

People are getting paid – whether it was through tobacco and can you imagine, last year tobacco sales by tobacco farmers fetched $600 million. Let us say of that, $400 million was produced by small scale farmers, all insisting to be paid in cash and in fact they were paid in cash. Having been paid in cash, we do not know where they put the money. So sometimes our success in the tobacco sector becomes the cause of our challenges, which is why we are now coming with the encouragement that they open bank accounts.

The same thing is happening with respect to gold production. We picked gold production from 13 metric tonnes in 2013 because of the fiscal measures that we adopted to 21,1 metric tonnes last year and artisanal miners whose activities we decriminalise are now contributing 40% of that and all of them demanding to be paid in cash. All we have been doing is withdrawing from the financial institutions but not depositing. So as long as you have a system where people are withdrawing and not depositing, it spells disaster to the economy and the measures we have adopted are to correct just that. I thank you.

(618 VIEWS)

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Charles Rukuni
The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.

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