Full statement by Confederation of Zimbabwe Industries (CZI) president Kurai Matsheza on the arrest of business leaders.
The Confederation of Zimbabwe Industries (CZI) along with other business member organisations and business leaders met with the RBZ and Ministry of Finance at the RBZ to address the currency situation.
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Submissions were made and the engagement was fruitful, culminating in a statement by the RBZ on the outcome, which underlines policy side, and business side interventions that need to be implemented immediately.
It is in this context that we are expectant that the policy correcting measures as well as business measurers will work simultaneously to correct the situation.
Bad policy blurs the lines and results in criminal activity co-mingling with legitimate business survival decisions in a forex mispriced system.
As we had stated in our submission, a heavy-handed approach to a problem that has its cause squarely in sub-optimal policy implementation creating arbitrage opportunities would be unsettling to the markets.
It is our considered view that the measures agreed at the consultative dialogue should be given time to take effect as they are going to most likely cause an adjustment of behaviours in accordance with their efficacy on the challenges being addressed.
Essentially, at the centre of this is a policy correction, when policies fail we should not arrest people, we should correct the policies for efficacy.
As CZI we reiterate that a true Dutch auction would perform the function of price discovery and pave way for a more liberal exchange rate regime.
The arrest of business leaders will only serve to destabilize the relationship between business and authorities as the two need to work together to reindustrialize the economy in pursuit of Vision 2030.
Fear will drive business decision making as has happened with the 2007 arrests with resultant shortages, as companies could not find any other ways of funding their forex requirements legitimately.
The arrests will also cause unnecessary panic in the market and erode consumer confidence in government policies.
In the meantime, we urge the authorities to ensure that the Auction System is managed in the true spirit of the Dutch Auction System.
Additionally, we encourage continuous dialogue between business representatives, the central bank and the authorities to find an amicable way out of the current foreign exchange challenge focusing on averting the imminent crisis while creating sustainable solutions to solve the long-standing currency issue as a way to boost economic growth.
CZI does not in any way condone any errant or unlawful behaviours.