Cash withdrawal: Our currency open to risk

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WE would like to pray and believe that the resumption of cash withdrawals from banks, earlier this week, will not end up as a mere transient gesture of goodwill by our monetary authorities.

We know there are many evil forces which don’t care a hoot if this turns out to be only a few days’ wonder.

These include those determined to feed the black market for self-aggrandisement.

There are also those ready to do all they can to see to it that any positive move fails (kudira jecha).

The country is dotted with illegal money changers who, somehow, have access to piles and piles of newly minted cash to channel to the informal market. 

How do these crisp bundles of cash get into the hands of these unscrupulous cash vendors?

Perhaps, that is why we are tempted to give credence to the theory that those entrusted with the stewardship of our money are, ironically, the very culprits responsible for the leakage.

This money never circulates back into the banks and formal channels, only to be readily available under mattresses and other such informal ‘banks’.

Punitive laws have been passed to deter would-be offenders but the cash vending business seems to be flourishing.

But so long as this cash circulates in the informal sector at will, cash shortages are here to stay.

We plead with those responsible to do everything humanly possible to plug  the loopholes while those seen in illegal currency trade should face the wrath of the law.

Law enforcement agencies should not sleep on their job.

Initial measures taken by the Reserve Bank of Zimbabwe to save the situation are, at face value, unpalatable and yet imperative.

A weekly cash withdrawal limit of $300 will control those determined to quickly empty the banks of all available cash.

Small cash denominations of $2 and $5 notes and $2 bond coins might appear a nuisance to businesspeople, but they will be forced to bank them.

Otherwise, they would not feel comfortable hoarding the big piles that would have accumulated.

Even for ordinary people, no one would feel very comfortable carrying with him millions of small notes and coins in one’s pockets. 

That is why the use of plastic money should always be encouraged.

The idea of charging three different prices for cash, swipe and EcoCash should be banned by law.

This turns to distort the value of a similar currency. However, for our money to be worth the paper it is printed on, it must maintain its value.

This, coupled with fiscal discipline by the authorities, will ensure that we will always walk out of banks with real money.

And this value has to be sustained by production  and not by the printing press. We have the resources both above and below ground to support our currency.

We are an agricultural country with a variety of crops whose yield can be boosted by properly organised contract farming.

The downstream effect will see the resuscitation of our industry whose products depend on our crops like soyabean, cotton, wheat  and, of course, cattle, among others.

We should produce and export to earn foreign currency.

Gone should be the era of earning foreign currency through an illegal black market.

This only helps to fuel inflation, rendering our cash withdrawals valueless.

What with our vast mineral resources which can also be used to hedge our currency against inflation!

If all our resources can be exploited to the benefit of our country, then, no doubt, our currency will remain strong.

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