The Reserve Bank of Zimbabwe (RBZ) has issued $43,9 million worth of bond notes, bringing the total to $72,9 million as at December 31, as the central bank forges ahead with the scheme to incentivise exporters.
BY BUSINESS REPORTER
As at December 16, the RBZ had issued bond notes worth $29 million. The bond notes were introduced into the market on November 28 under the $200 million export incentive facility guaranteed by the African Export-Import Bank to boost exports and generate more foreign currency for the economy.
However, the total amount of bond notes is below the $75 million projected to be issued by the end of 2016. At the rate at which the bond notes are being issued, the $200 million envelope would be exhausted by the end of the year.
In a statement yesterday, RBZ governor, John Mangudya said the bank had paid the export incentive to 80% of exporters of “goods and services including Diaspora remittances through the issuance of bond notes in the sum of $72,9 million”.
He said the major beneficiaries of the scheme were tobacco growers ($29,4 million), gold producers ($10 million) and Diaspora remittances ($5,4 million).
Mangudya said a number of firms that had ceased exporting due to the uncompetitive domestic economic environment, which included high cost of production and a strong United States dollar, have started to export as a result of the incentive.
“Productivity, which is the panacea to the current economic challenges bedevilling the nation, is gradually increasing. This includes the expansion of the tobacco crop grown this agricultural season and the reduction in the smuggling of gold, as the 5% incentive awarded to gold producers over and above the international gold price has been regulative to discourage smuggling,” he said.
Mangudya said the export incentive scheme came when the global economy, and Zimbabwe, in particular, were facing turbulent times.
“A sudden collapse in the prices of export commodities of interest to Africa, including Zimbabwe, and the appreciation of the United States dollar transmitted serious negative economic shocks to the national economy that required the bank’s attention,” he said.
The introduction of bond notes and the aggressive use of plastic money has helped to reduce the demand for cash, which created queues at banks. The bank notes, which are at par to the dollar, had faced resistance before their issuance, as people equated the introduction of the surrogate currency to the return of the local currency, which was decommissioned last year. The Zimbabwean dollar was rendered worthless by hyperinflation and subsequently replaced by a multi-currency regime in 2009, which now has nine currencies, including the dollar, in the basket.