File image: IOL
HARARE - Zimbabwe  is dollarizing once again against growing discontent with bond notes.

This week the opposition Movement for Democratic Change (MDC) leader Nelson Chamisa organised a protest action to pressurise the government into adopting the rand as its currency or demonetising the bond notes.

Chamisa said the government continued to maintain the quasi-currency regime despite its negative effect on the economy.

He said the bond notes had perpetuated the suffering of the citizens.

“Pending dialogue and discussion, we demand the following measures to be taken immediately: the immediate scrapping of the bond note, the immediate liberalization of the exchange rate,” Chamisa said.

Zimbabwe has adopted drastic austerity measures to jump-start the economy and to preserve foreign currency. It has also sought to improve the situation for gold and platinum miners by increasing the percentage of foreign currency they retain while a percentage is taken over by the central bank for allocations for importation of fuel and other key national commodities.

However, Finance Minister Mthuli Ncube is digging in on scrapping the bond notes.

Ncube this week said devaluing the bond notes would leave pensioners and other holders of savings will less value. 

“We are about preservation of value and we remember what happened in 2008 and 2009 when Zimbabweans lost value in terms of pensions, savings, company balance sheets,” Ncube said. We don’t want to go through that so that’s why we are fixated with preservation of value. This is key.” 

Zimbabweans lost savings and values when the country dollarised after abandoning the Zimdollar in 2009.

Businesses such as banks have used demand payment in foreign currency, offering forex accounts and allowing depositors to withdraw greenback.

Oil companies, which have been dogged by crippled allocations for petrol and diesel imports have also reportedly started to ask for payment using Visa and MasterCard.

Mthuli rebuffed claims that the government was failing to restore certainty to the business and investment environment through its economic policies and insisted that the economic program underpinned by austerity measures was aimed at dealing with the “twin deficits around the current account deficit and excessive demand for imports” in the country.

BUSINESS REPORT