THE Reserve Bank of Zimbabwe on Wednesday approved domestic trading in the Chinese Yuan, Indian rupee, Japanese yen and Australian dollar, in a move that will effectively make those currencies legal tender.
Presenting her monetary policy statement , Acting central bank governor Charity Dhliwayo said exporters and the general public could use and "open accounts denominated" in those currencies.
“Trade and investment ties between Zimbabwe, China, India, Japan and Australia have grown appreciably. It is against this background of growth in trade and investment ties that in the 2014 national budget, the minister of finance and economic development underscored the importance of including other currencies in the basket of already circulating currencies,” she said.
“In this regard, we wish to advise exporters and the general transacting public that in addition to opening of accounts denominated in Botswana Pula, British Sterling Pound, Euro, South African Rand, United States Dollar, individuals and corporates can also open accounts denominated in the Australian Dollar (AUD), Chinese Yuan (CYN), Indian Rupee (INR) and Japanese Yen (JPY)."
However, economist John Robertson did not think the move would make much of a difference to the country's problem of cash shortages.
"We are already using the pound, euro and pula but you hardly see these currencies in circulation in most parts of the country. The new currencies are likely to suffer the same fate," he said.
Solusi University’s Bongani Ngwenya said the introduction of more foreign denominations was likely to worsen the problem of cross rating, whereby the same currency is exchanged for differing rates in various parts of the country.
Posts
Comment Policy : We invite you to comment on our posts, as long as they are respectful, to the point and approving. We do not perform pre-moderation of comments. However, in order to keep this site clean and useful, we reserve the right to remove any comment that is not in accordance with our Comment Policy.