Stability of ZiG critical to reduce demand for use of US dollar

Q &A:

HON. A. T. MAVUNGA:  Afternoon Mr. Speaker Sir.  My question is directed to the Ministry of Home Affairs.  Mr. Speaker Sir, the happiness index in the country right now is at its highest and this is because of the introduction of the new currency -[HON. MEMBERS: Hear, hear.] – the civil servants, the population at large has been going in and out of shops and realising value for their money and that is very important Mr. Speaker.

However, Mr. Speaker Sir, some elements of sabotage have arisen in society, particularly in retail shops and other service providers that are introducing ungodly rates to the people of Zimbabwe.  Mr. Speaker Sir, what measures are in place to protect the citizens and apprehend those retailors and service providers that are sabotaging our currency, sabotaging the efforts of the Second Republic? – [HON. MEMBERS: Hear, hear.]

THE HON. SPEAKER:  I do not see the Hon. Minister of Home Affairs. The question was directed to the Minister of Home Affairs, measures to arrest the culprits.  May we refer to Hon. Ziyambi.

THE MINISTER OF JUSTICE, LEGAL AND PARLIAMENTARY AFFAIRS (HON. Z. ZIYAMBI):  Thank you Mr. Speaker Sir.  The Minister of Finance, Economic Development and Investment Promotion is responsible for putting in measures to ensure that the Minister of Home Affairs and the law enforcers will enforce that.  A more informed response may come from the Minister responsible for finance.  If you allow deferment of that question to him since he is around. I thank you.

THE MINISTER OF FINANCE, ECONOMIC DEVELOPMENT AND INVESTMENT PROMOTION (HON. PROF. NCUBE):    Thank you Mr. Speaker Sir.  I thank the Hon. Member for that very important question.  It is very important that we should protect our currency and keep it stable and discourage unnecessary speculation.  The speculation is unjustified.  It is clear what the fundamentals are that drive value, that underpin the value of this currency and therefore it should be clear to everybody that this currency should be stable and appropriate official exchange rate should be used for transaction purposes.  In our desire to protect that Mr. Speaker Sir, we are putting certain measures, certain sanctions on those who deviate from that objective. 

First of all, for those who are managing retail or own retail organisations and sell goods to the public, we are insisting as Government that they ought to use the willing buyer-willing seller price for foreign currency as the basis for pricing.  What we did last week after my presentation here to this House to the joint Budget and Finance Committee and also the Committee for Industry and Commerce, I did undertake that we will remove the 10% limit for certain prices and that was removed and it was subsequently brought to this House and we debated it, the House approved it and we are very grateful. We have removed any basis to deviate officially from the official exchange rate, that 10% exchange limit was causing deviation as an excuse for overpricing purposes.  So, from now going forward, we make use of the willing buyer- willing seller pricing mechanism and any deviation will be sanctioned through a fine of no less than ZiG 200 000 per offence.  So that is really the measures we have put in place to deal with the pricing by retailors. 

On individual trading on the streets and so forth, clearly, they do so without any licences, they are violating the exchange control regulations and the law has taken course of those that have violated and we have seen a few or more than 70 individuals being arrested.  Police have done their job and some of them have appeared before the courts so that they face justice and stop what they are doing.  It is very important that we must all abide by the law to protect our currency.  After all, that is the only domestic currency we have.  The other currencies are actually foreign currencies and we cannot develop a country without your own currency, neither can we have a full bouquet of micro-economic tools without our own currency and monitory policy. I submit, thank you Mr. Speaker Sir.

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