Banks reject rand adoption

Addressing delegates at the two-day Financial Markets Indaba in Harare last week, Barclays Bank Zimbabwe managing director George Guvamatanga said that the adoption of the rand is not the solution to Zimbabwe’s current cash crisis. He also said if issues of productivity are not addressed the country will continue having cash shortages.

Said Guvamatanga:

Adopting the rand is not the solution. The question we must all answer is do we want to be subjected to the South African monetary authorities. If the fundamental issues of productivity are not addressed we will continue having cash shortages.  One of our biggest problems is resource allocation. Last year we had $5,4 billion in capital inflows, where did all that money go? Since 2009, we have spent over $3,9 billion importing vehicles from Japan.

Bankers Association of Zimbabwe president and managing director for MBCA Bank Charity Jinya Jinya said that the United States dollar is a more stable currency which is the reason why Zimbabweans want to use it. Standard Chartered Bank Zimbabwe chief executive Ralph Watungwa said if the country adopts the South African rand, then it must be prepared to go introduce the Zimbabwean dollar. Steward Bank chief executive Lance Mambondiani said he has no problem in adopting any currency that may help improve the liquidity situation in the country.

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