Bond notes: RBZ clarifies launch date

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HARARE – Reserve Bank of Zimbabwe (RBZ) governor John Mangudya yesterday said bond notes were to begin circulating in October this year, following conflicting reports on the launch dates for the notes.

Mangudya said the apex bank needed about five months for the notes to be printed before they could be injected into the system.

“I do not know where the confusion is coming from with this August date talk. I said the notes needed at least five months to begin circulating, thus placing their possible introduction date sometime in October,” the central banker said.

Lickspittle State media had claimed on Sunday that the bond notes would be introduced in August.

Mangudya said the payment of the five percent bonus to exporters was necessary to sustain and safeguard the multi-currency system in Zimbabwe, with export vouchers to be disbursed to all exporters who have been exporting since May 5, 2016.

“We made the incentive announcement on May 4, so all exporters are accruing the incentive. The vouchers will be released dating back to all export transactions made from May 5,” he said.

Early this month, the under-fire governor announced the RBZ was set to print bond notes under a $200 million Afrexim Bank-backed bond, but the development was interpreted by some quarters as an attempt to sneak the discredited Zimbabwe dollar (ZW$) through the back door.

Zimbabwe — which abandoned its currency in 2009 and adopted nine currencies as legal tender in a multi-currency economy — still has fresh memories of the 2008 hyper-inflationary era where everyone in the country was a billionaire using the country’s worthless ZW$.

The proposed bond coins, to be printed in Germany, are set to make up a tiny fraction of the over $6 billion cash in circulation.

According to Mangudya, bond notes are not only earmarked as an incentive for exporters — the primary cash providers in the economy — but also to assist the common man with easy access to cash.

“The public should not confuse the export incentive or bonus scheme to be paid to exporters in the form of export vouchers called bond notes to assist exporters to generate more foreign exchange as a return to the local currency,” he said.

The bond note incentive set the nation into a panic frenzy with depositors rushing to withdraw their hard-earned monies from financial institutions — sparking fears of bank run-ins.

This comes as the Confederation of Zimbabwe Industries recently said Zimbabweans must embrace the proposed bond notes, saying they will boost internal trade and ease the cash crunch threatening Zimbabwe’s already lethargic economy.

Opposition leader Morgan Tsvangirai has called on Zimbabweans to reject the Zimbabwean version of the US dollar, warning that the country would “return again to the empty shops” of 2008.

In a short video clip posted to social media platforms recently, Tsvangirai said: “We have all walked that road before.”

Rejecting claims by the central bank governor that the new bank notes were merely meant to encourage exports, Tsvangirai said that President Robert Mugabe’s government would “abuse” civil servants by paying them in the new form of cash.

“All patriotic Zimbabweans must reject this,” Tsvangirai said. “These bond notes are an attempt to rig the economy.”

Former Finance minister Tendai Biti has warned that the bond notes will have cataleptic consequences to the remaining constructs of Zimbabwe’s pseudo economy.

“It is a decision that will see many of the remaining companies reach breaking point and simply shut down.

“Few are prepared to relive the nightmare of the meltdown period of 2007 and 2008.

“The move will also engineer a fresh wave of externalisation, under banking, tax avoidance and evasion,” the opposition PDP leader said.

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