RBZ relax Use of The US Dollar for transactions in Zimbabwe

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The Reserve Bank of Zimbabwe(RBZ) Governor Dr. J P Mangudya has announced the relaxation of the Monetary Policy that banned the use of the United States Dollar for local transaction in June 2019. In a move that the RBZ says are part of the central bank’s measures to deal with the coronavirus (Covid-19) pandemic.  The governor’s statement said that the measure will be reviewed when things get to normal.

Commenting on his facebook page, Dr Tapiwa Mashakada, Economist and MDC Secretary for Policy and Research said,

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“The process of disinflation has now begun in earnest. Although we take note of this latter day wisdom by the RBZ we are still concerned by the policy inconsistency of the regime. Zimbabweans are still suspicious because they cannot trust the system. We are not certain that down the line new measures will be announced confiscating free funds as people would have responded and banked US$. Policies work because of confidence.

We do not celebrate partial dollarization. We want a wholesale re-dollarization process which is backed by law. It means that a new Statutory Instrument should be enacted which decriminalizes the use of the US$ for domestic transactions.

We also call for civil servants salaries and private sector wages to be paid in US$ including salaries for the army, police,secret service and prison service. Re-dollarization must be holistic in order to inspire confidence. It must be a whole paradigm shift from mono-currency to multiple currency backed by legislation.

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