Sunday Mail Journalists
ATTORNEY General Kumbirai Hodzi warned of additional prison terms for economic saboteurs while the Reserve Bank of Zimbabwe (RBZ) said it would step up the blitz against the manipulation of local currency against the US dollar.
The RBZ will meet with producers and retail outlets this week to deliberate on solutions to eliminate black market prices for goods.
In addition, the RBZ will introduce new measures to tighten the growth of the money supply, as part of the strategy to suppress the economic sabotage that has resulted in the ZWL $ pegging up to US $ 200-1.
The official bid rate for US $ 1 is $ 85.
Companies, individuals and some banks have been accused of manipulating parallel market rates, causing the prices of goods and services to soar and disrupting the country’s economic growth prospects.
To date, authorities have stepped in to restore sanity to the market with a number of arrests, but more individuals, businesses and bank officials will be arrested.
In an interview yesterday, Mr Hodzi said they would vigorously oppose the release on bail of the economic saboteurs, who had become a security threat.
“Anyone who is arrested will be remanded in custody and on strongly opposed bail to stay in jail. Yes, I gave a specific instruction and directive to this effect and the blitz started on Friday evening, ”he said.
Mr Hodzi said it was not the first time they had led the blitz, but the saboteurs were unrepentant and changed tactics with each passing day.
“This time it will be a sustained blitz, not a short-term one. What happens is that every day they get together. Every day they break the laws and come up with new tactics. We have learned our lesson. Every day, law enforcement is carried out, but these criminals are changing the characteristics of their practice.
“The government has worked frantically to stabilize the economy, but it is finding ways to disrupt it. A number of regulatory texts (IS) were introduced but they broke them. There will be no sacred cows and it is not at all politically motivated, because these people have been sabotaging the economy for a long time. “
RBZ Governor Dr John Mangudya told our Bulawayo office yesterday that he would meet with retailers as part of a cocktail of measures to stop malicious pricing of goods and services.
“The bank therefore continues to tighten money supply growth further, refine the auction system to ensure that there are no auction arrears and deal with outliers.
“The bank is also arranging to meet with the biggest producers and the biggest retail outlets next week to work out the best way to ensure that stability is restored to the economy, as almost everyone in the the economy seems to be parallel exchange rate proponents with no one responsible, so meeting the business world is essential for the benefit of all and of the economy.
He said parallel rate volatility has nothing to do with economic dynamics or fundamentals, but is caused by behavioral dynamics, particularly rent-seeking behavior of capitalizing on people’s past experiences with l hyperinflation and dollarization.
“The instability of parallel rates is not beneficial for businesses and consumers because it makes business difficult to run while high implicit rates erode consumers’ purchasing power from their income or money. High rates have negative effects on inflation.
Dr Mangudya said that while the auction rate is determined by the exchange offers submitted to the central bank by the entities through their bankers, the parallel exchange rates appear to be the result of competition for currencies at all costs without taking into account the many downside risks to the economy. , businesses and consumers.