Zimbabwe Finance Minister refuses to budge on relaxing cash withdrawal limits


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Zimbabwe Finance Minister Mthuli Ncube has refused to relax cash withdrawal limits as the marketing season for tobacco, maize and other agricultural products begins.

Responding to questions in the Senate on Thursday, Ncube said the limits and the use of mobile money were regulated because of the abuse which was fuelling the black market.

“The issue about regulating access to cash was triggered by the abuse that we had seen taking place from the use of the mobile banking platform in terms of electronic money,” he said.

“We realise that it is necessary to restrict the cash withdrawals, the amounts that can be used at any point in time and be transferred at any point in time.  This is necessary for us to keep those restrictions in place as a general policy.

“If we loosen up on that, it will cause us a lot of difficulties and basically we will go back to where we were before, where individuals will access larger amounts of cash and then want to trade in the parallel market and just make our currency more unstable.”

The Zimbabwe dollar has been fairly stable since the country introduced the foreign currency auction on 23 June last year.

Inflation has dropped from 837.5% I July last year to 240.6% this month.

Defending his decision, Ncube went on: “I think you will agree with me Hon. Senator that at the moment, the most valuable thing from a micro-economic sense is stability of our currency which is spreading stability and creditability everywhere and that is a fact we must all work to protect.

“For farmers specifically, we are also of the view that they should always be assisted, especially the tobacco farmers that we are talking about.  They work so hard to earn us this hard earned foreign currency – so again, we can look at making special arrangements for them.

“Some of them have come a long way to the city to sell their tobacco.  So perhaps I will see what we can do to support them better.  That will not be a generally policy, it will be something specifically for them, but I am not promising anything, it is only because we realise the value that they create for this country and perhaps they should be supported.”

 Q & A

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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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