Zimbabwe earns $3.2 billion forex in 8 months

Zimbabwe’s foreign currency receipts rose 6.6 percent to $3.2 billion in the eight months to August from $3 billion in the comparable period last year, buoyed by mineral earnings, according to central bank governor, John Mangudya.

“I can tell you that between January and end of August, the total receipts of foreign currency earned is about $3.2 billion. This was from exports, diaspora remittances and loan inflows,” Mangudya told a meeting with retailers.

“For a country in our position, this money is not small change but the expenditures tell a different story, take the public sector for example, it has actually recorded salary increases over the past few years, from $50 million per month in 2000 to the present $250 million.”

He said by comparison, Rwanda, which recorded a 5.9 percent GDP growth in 2016 against Zimbabwe’s 0.7 percent in the same year, earned $1.2 billion from exports in 2016.

“Zimbabwe’s problem (is) because the increased demand for the United States Dollar (US$) is not matched by an increase in the supply of foreign exchange,” said Mangudya.

The southern African nation is in the throes of a cash crunch, and is relying mainly on mineral export earnings and remittances from the diaspora after poor tobacco sales while it lags regional counterparts in attracting Foreign Direct Investment.

As at June this year, Zimbabwe had earned $1.6 billion from exports, $784 million in diaspora remittances, $140 million in FDI and $224 million in external loans according to central bank data.

The Tobacco Industry Marketing Board this week said as of September tobacco exports had generated $380.6 million — much lower than the target of $551 million.

Mangudya said despite rationing the little available foreign currency through the central bank-drawn import priority list, Zimbabwe was still struggling to control its expenditure.- The Source

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