Zimbabwe Finance Minister refuses to budge on relaxing cash withdrawal limits

HON. PROF. M. NCUBE: Thank you very much.  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.  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.

I think you will agree with me Hon. Senator that at the moment, the most valuable thing from an 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.  I thank you.

*HON. SEN. DENGA: Thank you Mr. President, I am saying that the Minister did not address my question fully regarding maize farmers.  Fertilisers are bought using foreign currency and other inputs like herbicides, so the question is how is GMB going to pay? Are they going to pay in foreign currency or not?

THE MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON PROF. M. NCUBE): Thank you for coming back and seeking further clarification on his question. We have done some analysis which shows that the cost of these inputs that he has listed has remained relatively stable and so has the currency. The whole item that has increased somewhat and is quite variable is labour cost – when we consider the price model for maize, that is what we are finding out. Everything else is stable except labour costs.

In terms of the items he has listed, the prices have not moved much. We are confident that the price that we are offering, that is the selling price for maize in Z$ terms would be able to cover the farmer sufficiently recognising that the prices of these inputs have not moved much. Farmers are paying for these inputs in US$. In Z$ terms, the farmer is fetching a good price because the exchange rate has not moved much. That stability is what gives us the confidence that paying in Z$ is the right thing to do. After all, it is our domestic currency.

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