‘Supermarkets Cannot Sell In Forex While They Pay Their Suppliers In Local Currency’

The Association for Business in Zimbabwe (ABUZ) has said the Finance Ministry must clarify if some businesses, particularly supermarkets, are now allowed to sell in United States dollars as has been happening in some sectors.

This comes after the Reserve Bank of Zimbabwe (RBZ) announced last week that individuals with free funds can now buy goods and services locally using foreign currency.

ABUZ chief executive officer, Victor Nyoni argued that if supermarkets are allowed to sell goods in forex, then the entire supply chain has to be afforded the same privilege. He said:

If so this, unfortunately, will cause a critical part of our economy to dollarise. Supermarkets cannot sell in forex while they pay their suppliers in local currency.

It becomes an unfair trade. Suppliers too would want to be paid in forex in order to meet their forex obligations with ease.

Another challenge is that supermarkets will apply mechanisms to attract customers with forex. This will mean that one supermarket will begin to offer higher rates above the 1:25 stipulated by Government as an incentive and that will further devalue the Zimbabwe dollar.

Who will exchange the USD at 1:25 when they can obtain more in the streets and still buy from the shops that will observe the application of the fixed rate rule?

More: Chronicle

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