Zimbabwe Finance Minister Mthuli Ncube has listed five priorities for this year with the top one being the injection of $500 million into the economy in the next six months to ease the cash shortage.
Ncube promised to inject $1 billion into the economy last year and ploughed in $400 million up the end of the year.
The country’s monetary policy committee said Zimbabwe had $1.1 billion in circulation at the end of December constituting 3.2 percent of bank deposits which stood at $34.5 billion.
Ideally, currency in circulation should be 10 percent of deposits which means that Zimbabwe should have at least $3.4 billion in circulation.
The injection of $500 million in the next six months will therefore mean that the country will have less than half the cash it requires to meet minimum standards.
Ncube also said Zimbabwe is injecting $8.5 billion in the energy sector to ease power shortages. He said the government will be offering incentives to those who want to go off grid.
The third priority is food security. Ncube said no Zimbabwean should go hungry. The World Food Programme estimates that 7.7 million people need food relief.
Fourth on the list is the exchange rate. Zimbabwe reintroduced its own currency last year at the initial rate of 2.5 to one United States dollar.
The currency has since plunged to 17.35:1 on the interbank market but in way down on the black market with the Old Mutual Implied Rate at 32.76:1.
Finally, Zimbabwe says it wants to create jobs and has put mechanisms in place to achieve this.
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