Mnangagwa says there is no going back to multi-currency

The multi-currency era is gone for good and Zimbabweans must embrace the reinstated local currency as it finds its place among other world currencies, President Emmerson Mnangagwa said today.

Government banned the use of multi-currencies, dominated by the US dollar, in the second half of the year, and reinstated the Zimbabwe dollar as the sole legal tender.

The multi-currency regime had been in use for a decade, after it replaced the Zimbabwe dollar which had been driven to worthlessness by hyper-inflation of hundreds of million percent in 2009.

The local currency, however, has faced headwinds since its return, losing considerable value in a short space of time against all major currencies, in an economy again ravaged by high inflation.

On introduction nearly six months ago, the local dollar traded at 2.5 to the greenback, but now trades at around US$1: $17 on the official inter-bank market. It is even weaker on unofficial markets.

And some shops and service providers continue to charge in US dollars, while almost all retailers have pegged prices to the unofficial exchange rate of the US dollar.

Addressing the 18th ZAU-PF National Peoples’ Conference, Mnangagwa urged Zimbabweans to protect their own currency at all costs.

“Every single country has its own currency, which it calls its own. We will not revert back to the basket of currencies,” he said.

The Zimbabwean dollar, he said, must be protected as a symbol of our “sovereignty and pride”.

Mnangagwa issued a stern warning to people sabotaging the local dollar, those hoarding cash and trading on the parallel market.

“Those who continue to deal in the (illegal) money market, I say to them all, the long arm of the law will catch up with them,” he said.

“Law enforcement agencies will deal with those who are hoarding cash and fuelling shortages.”

Zimbabwe has battled bank note shortages for years, and the recent reinstatment of the local unit has failed to stem the tide.

But Mnangagwa said monetary authorities would continue to drip-feed more cash into the system to avoid fuelling inflation if this was done at once.- New Ziana

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