Source: Tatira Zwinoira, NewsDay
INDUSTRY and investors have called on the central bank to announce the “actual date” when the anticipated bond notes would be released to stem uncertainty, which has seen run-away withdrawals and reduced deposits.
The call comes as the Reserve Bank of Zimbabwe (RBZ) begins an awareness campaign on October 31 ahead of the release of the bond notes, which would be ostensibly introduced to boost exports.
In May, RBZ governor, John Mangudya said bond notes would be introduced under a $200 million export incentive facility guaranteed by the African Export-Import Bank.
But he has remained mum on the exact dates the notes would be introduced.
A source closely linked to investors told NewsDay yesterday that they were anxious after noticing the uncertainty prevailing on the local market.
“If the market has no confidence, then what they [investors] will do is behave accordingly, because there has been a lack of confidence. So, while it is true, the aggregate numbers [deposits] can increase and he [Mangudya] is not seeing the negatives. If the truth be told, people are holding onto their cash,” the source said.
“Why do you want to do a survey if you are hell-bent on releasing the currency? You have asked people ‘do you want this?’ They said, ‘no we do not want’ and then you go around and still do it. So is it really consultation or are you just telling people what you are going to do?”
He said there had been a lag between policy announcement and policy implementation, “particularly when you are not even listening to the market anyway”.
Mangudya has said he would take full responsibility if the bond notes affect the market negatively, but that bait has found no swallowers.
Confederation of Zimbabwe Industries (CZI) vice-president, Sifelani Jabangwe said the introduction of bond notes had to be done expeditiously, as further delays were damaging the economy.
“We might fail to perform at the level we should be, which just reduces market confidence. So, as we are saying, it might affect liquidity. Right now, very few people are depositing cash into [bank] accounts because we are concerned how these bond notes will work. It is a good exercise to find out how these bond notes will work, but for as long as they are not introduced, the situation, in terms of cash, will probably remain as it is,” he said.
“Our only worry is the market, because it does not understand how these bond notes work. For as long as they are not introduced, the market will keep holding onto to its cash. They should just be introduced, so that the market will see what we have been talking about, that the actual quantity of the bond notes is not that much.”
According to CZI, industry requires $2 billion for retooling — a huge amount which cannot be obtained locally necessitating the drive to lure foreign investors.
Statistics from the Zimbabwe Investment Authority showed that investment was lagging behind by $10,44 billion since 2011.
Source: Tatira Zwinoira, NewsDay