Former Deputy Prime Minister Arthur Mutambara has trashed the Reserve Bank of Zimbabwe’s (RBZ) Mosi-oa-Tunya gold coins initiative, supposedly meant to ease inflation, as nothing other than a “shameful opportunity for the elite to loot.”
The RBZ introduced gold coins which economist Prosper Chitambara says are a government’s attempt at moderating the very high demand for the United States dollar (USD).
Posting on Twitter, Mutambara said:
Gold Coin: A Self-Enrichment Scheme for the Elites
Take your USD to the parallel market and get RTGS at, say, 1 USD to 950. Buy gold coins in RTGS at 1 USD to 441 (gold coin exchange rate) and make a profit of more than 100%.
The Gold Coin arbitrage. This is common sense. Gold Coin & the Elites. It gets worse!
For the elites; you take your RTGS to the RBZ and buy USD at the auction rate, say 320. You take this ill-gotten USD to the parallel market and buy RTGS at 950.
That is a profit of 200% Then go and buy your gold coins at 100% profit. From 10K USD to 60K USD (With no Production).
500% Profit for the Elites. Take 10k USD to the parallel market and buy RTGS at 950. Go to the RBZ & buy USD at 320 (auction rate). Go back to the parallel market & buy RTGS at 950.
Buy gold coins & pay in RTGS. It is shameful.
The central bank chief, Dr John Panonetsa Mangudya Monday launched 2 000 Mosi-oa-Tunya gold coins with a value of US$1 824 each, to provide “an alternative store of value.”
The figure is equivalent to ZW$805 745.35 for each.
Mutambara was Zimbabwe’s Deputy Prime Minister during the Government of National Unity (GNU), between 2009 and 2013 when the country realised considerable economic development.