In its statement, the CZI said a true Dutch auction would perform the function of price discovery and pave way for a more liberal exchange rate regime.
It has urged the central bank to reduce the foreign currency allotted to bidders to US$25 million so that companies get their money on time.
Business believes that the black market was fuelled by the backlog in disbursement funds allotted at the auction which at one time was reported to have reached US$200 million with some companies waiting for two months, instead of two weeks, to get the money.
“The arrest of business leaders will only serve to destabilize the relationship between business and authorities as the two need to work together to reindustrialize the economy in pursuit of Vision 2030,” CZI said.
“Fear will drive business decision making as has happened with the 2007 arrests with resultant shortages, as companies could not find any other ways of funding their forex requirements legitimately.
“The arrests will also cause unnecessary panic in the market and erode consumer confidence in government policies.
“In the meantime, we urge the authorities to ensure that the Auction System is managed in the true spirit of the Dutch Auction System.
“Additionally, we encourage continuous dialogue between business representatives, the central bank and the authorities to find an amicable way out of the current foreign exchange challenge focusing on averting the imminent crisis while creating sustainable solutions to solve the long-standing currency issue as a way to boost economic growth.”
The industrial body however added: “CZI does not in any way condone any errant or unlawful behaviours.”
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