Bond notes not solution to Zimbabwe’s woes: IMF

THE International Monetary Fund (IMF) says Zimbabwe requires a comprehensive policy package to retrieve the economy from the woods, instead of seeking salvation in bond notes.

BY BUSINESS REPORTER

IMF African Department director, Abebe Aemro Selassie told journalists on Sunday that a holistic package of reforms was needed to get Zimbabwe out of the crisis.

“There’s a limited amount of foreign exchange inflows coming in and no monetary policy tool. So, they are in a difficult circumstance right now. We think that, going down this one [bond] note route, in and on itself, will not address the challenges that the country has.

So, it’s very important to have a more comprehensive policy package, which also addresses a lot of the fiscal challenges that the country faces, a lot of the structural reforms that have to be done,” he said.

Selassie had been asked to comment on the bond note concept.

Bond notes were introduced last November under a $200 million export incentive facility guaranteed by the African Export Import Bank. To date, bond notes worth $120 million have been issued.

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Selassie’s remarks corroborate sentiments by many local economists and analysts, who had dissuaded the Reserve Bank of Zimbabwe (RBZ) from introducing the surrogate currency. RBZ plunged headlong and introduced the bond notes which have been blamed for the flight of the United States dollar from the official system, thereby fuelling a black market. Cash hoarding has been prevalent with the $5 and $2 notes disappearing from the official system.

The central bank accuses some ungrateful foreign-owned businesses of hoarding cash. The businesses are operating in the reserved sector of the economy. RBZ has rolled out a number of controls to manage the cash situation.

Recently, RBZ placed a cap of $20 on cash back facilities offered by retailers. It has also ordered banks to put a withdrawal limit of $200 per week.

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37 Comments

  1. Reserve bank of Zanu…nonsense

  2. It’s the politics, stupid!

  3. “Home grown solutions for home grown problems…” Mangudya busy feeding us poison.

  4. It does not require a rocket scientist to see that as we move towards 2018 election, Tsvangirai and his allies are trying to create a situation that puts Zim on a difficult condition for the general public to believe ZANU (PF) has failed the nation. If one can not see that cheap politics then lets not discus it.

    1. First Minister

      Toropito you are right. Tsvangirai should stop politics of making the people of Zimbabwe suffer so that we vote for him. Hazvishande.

      1. do you even understand how the government and the economy work? i doubt that very much.

      2. what has tsvangirai done? Wake up you laggards

      3. Very unreasonable,do not hate Morgan for Zanupf mess

    2. i second that Toropito

    3. Toropito you aree the dumpest skunk I have ever come across. You and ur incompetent ZANOIDS brought bond notes. The people said kno to them. You crushed them on the streets with your mafia clowns masquareding as state police. Endure your madness and stop this dubious blame shifting.

  5. It does not require a rocket scientist to see that as we move towards 2018 election, Tsvangirai and his allies are trying to create a situation that puts Zim on a difficult condition for the general public to believe ZANU (PF) has failed the nation. If one can not see that cheap politics then lets not discus it.

  6. Toropito you are shortsighted. Do you have other solutions because the ones we have, have all but failed

  7. Toropito is mad, how does Tsvangirai create any situation, is he in Govt. Toropito is a mad Zanu Pf Lunatic. The Zanu Pf Govt are the ones ruling the country, we are all paying Taxes to them, they should come up with solutions for the country’s problems- where does Tsvangirai come in.

    1. taura hako.

  8. ZANU PF HAS FAILED PERIOD, THEY COULD NOT EVEN FULFILL JUST ONE OF THEIR 2013 ELECTION PROMISES. ZIMBABWEANS DONT BE FOOLED WITH THIS ZANU PF, FOR 37 YEARS THEY HAVE RUN DOWN THE COUNTRY, ROADS ARE NOW DISH HOLES, YOU CAN NOW BATH YOUR CHILD IN THE ROAD, NO DRUGS IN HOSPITALS, EDUCATION SYSTEM RUN DOWN BY THE DOKORAS WHO WANT TO INTRODUCE MUSLIM EDUCATION, NO CASH IN BANKS AFTER WE LOST ALL OUR SAVINGS IN 2008, 90% OF ZIMBOS ARE UNEMPLOYED, PEOPLE ARE NOW SELLING WARES AT SUPERMARKET DOOR STEPS, THE LIST IS ENDLESS – TO HELL WITH ZANU PF.

  9. respond you are right toropito atori nerabies

    1. Heheheheh toropito is a zanu screwee

  10. The RBZ should manage lending / borrowing policy rationally to encourage bank usage by citizens. A situation where banks are actually charging interest on deposits, through various levies, is untenable.

    Adoption of the Rand could help a bit, rather than including currencies whose owners do not want them traded internationally in the basket, such as the Yuan and the Rupee. But then the economic creature will mutate and find a loophole and externalise via South Africa.

    Bottom line, more spending should be on productive activity and not on ghosts and executive largesse. Pay the tobacco farmers. The money is theirs and is not even sourced locally

  11. Unfortunately this government does not have the brains to do that so we are in a catch 22 situation,. The regime is here to stay meaning the problems are here to stay. Brain dead politicians whose domain are their tummies with monkey brains can never remove us from the mess they created. They don’t know how ZIsco closed, They don’t how NRZ was run down, They don’t know how Zupco was run down, CSC, David Whitehead, Hwange colliery and then you expect them to know how to fix. A man calling himself Dr Bimha goes on TV saying 3 firms are manufacturing mining equipment but he does not even know their names, imagine 3 firms making such large equipment and you don’t know their names but you have the guts to go on TV. Why I say they don’t know how, its because when they take anything to their homes they think they are entitled so that cow should keep providing milk even if they don’t feed it. One director akaita mashura pa Zisco kuita bira pa Zisco using rituals with his daughter and you think that is managing a company.

  12. toropito munhu wema drugs uyo

  13. Ana Toropito……kkkkkkkk…….scum brained

  14. Toropito is right. Can’t you all see that Chamatama is blocking all Presisent’s efforts to revive the economy.

  15. Toropito is right. Can’t you all see that Chamatama is blocking all President’s efforts to revive the economy.

  16. Down with sanctions

  17. Any fool can criticize,condemn,complain and most fools actually do so.Zanu pf is a part full of fools and criminal elements,because all of them can not believe,think positively and see clearly that they have total destroyed zimbabwe,destroyed and wiped out family coersions at large commonly because of their personal and selfish gains.Down with this spirit of these devils.Instead of growing Zimbabwe economically through competitive means,Zanu pf is always oppressing people, a very stupid ideology they have created in Zimbabwe.God’s time shall come and it will come what may.

  18. toropito ukwane.tsvangirai haasi iye akati mu printe bond.

  19. l don’t understand this business of bond notes,we now have more figures than hard cash.Swiping is a short term solution to our problems.Vending it’s another short term strategy to employment as most industries are closed.So we are jumping from one crisis to a bigger one.History is repeating it again.The country is retrogressive rather than moving forward in front of watching technocrats why.lf we stop heavy carrier vehicles on our roads, National Railway will generate the required jobs in no time.The question is are we all now blind to see whats good and bad.

    1. “we now have more figures than hard cash” You could not have said it any better. To put things into perspective, we have about $7bn in bank deposits and around US$200m in real cash. You are right that we are moving from one crisis to another. While Gono expanded money supply by printing paper money, Mangudya and the entire banking sector, are doing the same by printing money, not in cash, but in electronic form. Just for your information, banks last year created just over $1bn dollars in interest alone. This was not backed by a corresponding inflow of real US$ cash of 1 billion into our financial sector. And this creation of electronic money can only grow exponentially as the balances keep increasing, and in the process, chasing away the real dollars out of our economy. So, yes, we are heading into another currency crisis which is manifesting in cash shortages and outward payments backlog.

  20. Richard Deschain

    “Bond notes not solution to Zimbabwe’s woes: IMF” Well duh!

  21. No comment on the “Goat” currency???

  22. Regai azviti toropito urika toropito chaiko hakafungi..Save vapinda papi apa bva kana zvakadero Tsvangi vakuru tosangana pa 2018 election, makomba arikuiswa naTsvangi here ndiye akaunza bond muno here,kusafunga mhani

  23. Ana Mugodhi shame Tsvangi apinda papi apa where is he blocking the President leave him alone inga munomuti chekushata wani teaboy zvino kana makublokwa nana Save sorry maningi hahahahahaha

  24. In these troubled times it would be a good idea for this inept regime to restrict people to drinking a certain number of beers per week so as not to waste money on non-essentials. An outright ban on beer drinking would cripple the breweries and people employed therein. Who would have thought a country can run out of cash? So much for independence!
    Provoking a w*r with, say, rich S Africa would create jobs for people in Zimbabwe making a*maments. How about that? Desperate times call for desperate measures.

  25. The last one is just a joke that someone said about the crises in Zimbabwe – ways to revive the economy.

  26. Time will tell

  27. The North Koreans Have threatened Mighty America with nuclear missiles. Why cant we “did” it too?

  28. Toropito istupeti

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