Mugabe says cash crisis is temporary


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President Robert Mugabe says the cash crisis is “temporary” and that government will press on with the introduction of bond notes, which he called a “surrogate currency,” despite opposition from the market.

The public would eventually get over their initial resistance to bond notes and accept them, Mugabe said this afternoon, in his first public remarks on the cash crisis.

Those opposing the measure were doing so either for political reasons or out of ignorance, Mugabe said.

Speaking to the ZANU-PF Central Committee, Mugabe conceded that the long term solution to the cash crunch would be to grow exports by reviving struggling industry and agriculture.

“As I address you, cash shortages are being felt across the board by our people, who cannot easily access their savings and earnings. You might have deposited money in the bank, but there is no money, not enough money. But this is a temporary problem which should be behind us soon, sooner rather than later,” Mugabe said.

Mugabe blamed the cash crunch mostly on the collapse of Zimbabwe’s exports.

“We have been operating under a basket of currencies belonging to foreign countries, even then the basket extended to carry just one currency, the US dollar, which comes to us only by earnings by way of exports.”

However, repeating comments by his Finance Minister Patrick Chinamasa and central bank governor John Mangudya, Mugabe also blamed “crooks” that he said were coming into the country to “fish” for dollars.

“Beyond being a medium of exchange, the USD has become a commodity, by all manner of people of different nations, venturing into our country to cream off our earnings. We cannot allow the situation to continue just like that,” he said.

“Take all the countries around us; Mozambique, Botswana, Zambia, South Africa and others. They have their own currencies, but they need the dollar also for their international trade and other external activities. They come here – Chinamasa has said ‘we are now like a fishing pool’- they come from these countries to fish the dollar here.”

“They will have to deal with bond notes as a surrogate currency, surrogate to the US dollar that we hold in our reserves.”

Mugabe, however, said only growing Zimbabwe’s exports would ensure a long term solution.

“Since we do not print the dollars – they are American – unless our volume of exports increases, we are left with less and less each time,” he said.

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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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