RBZ Says Foreign Currency Balances Will Be Protected Under Mono-Currency Plan

Reserve Bank of Zimbabwe (RBZ) Governor John Mushayavanhu has said the country’s planned transition to a mono-currency system will not require the compulsory conversion or liquidation of foreign currency balances.

Mushayavanhu reiterated that the return to a single currency will only happen once the Conditions Precedent (CPs) set out in the National Development Strategy 2 (NDS2) have been met.

He stressed that the transition is not tied to a specific date but will occur only when economic agents are indifferent to being paid in either Zimbabwe Gold (ZiG) or US dollars.

According to Mushayavanhu, when the country eventually adopts a mono-currency system, holders of foreign currency accounts (FCAs) will not be forced to liquidate or convert their balances, and all existing contracts will continue to be honoured in the currency in which they were originally concluded.

He said the only significant change will be that all domestic transactions must be settled in the local currency. For example, consumers who hold US dollars in their bank accounts and wish to buy goods such as bread will first have to convert their funds into ZiG through a bank or bureau de change before making the purchase.

“[So] where is the confusion coming from?” Mushayavanhu was quoted as saying.

More: The Herald

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