Promote use of local currency: RBZ

THE Reserve Bank of Zimbabwe (RBZ) has encouraged businesses to promote the use of
local currency to strengthen its demand saying this is critical in driving sustainable
economic growth in line with the National Development Strategy (NDS1).

While the country is still using a dual currency system involving the Zimbabwean dollar
and a basket of foreign currencies, the authorities have clearly stated that in the long run
the local dollar must be the sole currency for all domestic transactions.

Speaking during the NDS 1 outreach workshop held in Bulawayo on Friday, Reserve Bank
of Zimbabwe (RBZ) Economic Research Policy principal economist, Dr Stephen Moyo,
said using the local currency will help in terms of domestic resource mobilisation for
infrastructure development projects, which will save the country from creating debt.

He said the Central Bank will continue to come up with measures to back the local
currency.

“We encourage businesses to embrace the use of local currency and push for aggregate
demand,” said Dr Moyo.

“The local currency is very important. We believe that the local currency is key to
sustainable economic growth,” he said.

Many businesses and individuals have been preferring to use United States dollar (US$)
in their transactions, which weakens demand for the local currency.

The development prompted Government in May this year to come up with several
measures to contain inflation, which include increasing interest rates, introducing a
willing buyer willing seller forex trading platform and introduction of gold coins as a
means to store value.

gold coins
The measures have seen the monthly inflation falling to 1,8 percent in October 2022,
which is the lowest since April last year and the second lowest for more than three years.

Dr Moyo said through use of local currency, which has been mobilised through various
taxes, Government has managed to implement several huge projects, which include
construction of dams and roads as well as rehabilitation of some roads and irrgiation
schemes.

He said the introduction of gold coins has also helped to mop up the excess liquidity and
US$13,6 billion worth of gold coins have so far been sold. —The Chronicle