Reserve Bank of Zimbabwe governor John Mangudya has once again called on businesses to slash prices and banks to reduce interest rates because they are too high. “We lack competitiveness of our products because of the high cost of doing business because we are using the US dollar. The US dollar has been appreciating against all major currencies and because of that, products of our neighbours are cheaper. In other countries they can depreciate their currencies to maintain their competitiveness, but in Zimbabwe we cannot because we have a fixed exchange rate because we are using the US dollar. What we need to do therefore is to depreciate the currency internally through price reductions because our prices are very high,” he was quoted by The Herald as saying. “We have people with the Zimbabwe dollar mentality of making 100 percent profit. We need to change that. My appeal is let us respect the US dollar. We need to adjust downwards the cost of finance. Banks interest rates are up to 30 percent, making it difficult to borrow,” he said.
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