Zimbabwe’s former finance minister, Tendai Biti, described Statutory Instrument 81A of 2024, which had prohibited retailers from charging more than 5% above the official exchange rate, as a “toxic” policy aimed at artificially fixing the exchange rate and protecting a failing local currency.
This follows the government’s introduction of Statutory Instrument 34 of 2025 on Wednesday, April 16, which gives businesses greater pricing flexibility by removing the requirement to use the official exchange rate.
Posting on X (formerly Twitter), Biti said the fixed exchange rate had caused significant damage, including arbitrage (profiting from the gap between official and market exchange rates), the expansion of the informal economy, and capital flight. Said Biti
Through SI 34 of 2025, the regime has repealed SI 81A of 2024 which regulation prevented retailers from putting an exchange rate mark-up of 5 %above official exchange rate.
SI 81 A represented a toxic attempt to fix the exchange rate and protect a discredited and tattered local currency
A fixed exchange rate has created arbitrage in the economy and the expansion of the cash rich informal sector.
The fixed exchange rate has led to massive de industrialization & capital flight from Zim. Yet at the same time it has allowed ZANU cronies & cartels to loot.
He said that while the general public suffered, politically connected individuals benefited, enriching themselves through access to cheap foreign currency.
Biti called the Reserve Bank a “crime scene”, accusing it of allowing politically connected people to get cheap U.S. dollars at an unrealistic official exchange rate, and slammed the Dutch Auction System (introduced in 2020), saying it was a scam. He said:
The Reserve Bank was a crime scene that allowed cronies to access cheap foreign currency through the medium of a fake exchange rate.
The now disbanded Dutch Auction system introduced in June of 2020 was one of the biggest all time scams in post independent Zim.
US$4.08 billion was disbursed &yet the country has nothing to show of it except mansions & Bentleys in Shawasha Hills.
SI 81A should never have been enacted. Its repeal is neither progress nor a damascene moment.
Those celebrating same are naive.Damage has been done which requires boldness.
Biti proposed a clear, bold economic direction which guarantees the use of the U.S. dollar beyond 2030, and allow the new currency (ZIG) to float freely, not be pegged. He said:
In our view there must be unequivocal guarantees that the US$ will exist beyond 2030, ZIG must be floated and Export Surrender Requirements scrapped.
The regime must stop printing money & live within its means The debt question must be addressed urgently& corruption must stop.
Biti said ZANU-PF is incapable of fixing the economy, accusing the party of being more focused on internal power struggles, obsessed with retaining power, and suppressing citizens and dissent.
He called for a “new consensus” and “a new beginning,” though he did not provide details on what that would entail.
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