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“bond notes will stay until we have our own currency”: Chinamasa

FinTech

“bond notes will stay until we have our own currency”: Chinamasa

Zimbabwe will not stop using surrogate bond note currency until the economy completely recovers, Finance Minister Patrick Chinamasa said on Wednesday.

Since Emmerson Mnangagwa became president last November, there has been rumors that bond notes would be scrapped.

“Nowhere did the Deputy Minister (of Finance and Economic Planning Terrence Mukupe) say the bond notes are going to go away and that is the sort of negativity that is not going to get us anywhere,” Minister Chinamasa said  Responding to questions on the fate of the bond notes at a breakfast meeting in Harare yesterday.

“We need to address the budget deficit; we need to address the issues of exports and we need to build foreign currency reserves of at least three months, at the moment we are at 0,7 months,” the Minister added.

When he introduced the bond notes, Mangudya said the fiat currency would trade at par with the United States dollar, something critics questioned from the onset. In November premiums on the United States dollars had risen to 70% on the back of increased demand from companies sourcing foreign currency from the parallel market amid fears the continued depreciation of the bond note will quicken inflation.

Minister Chinamasa emphasized the point that country needs to boost production.

“This is why we are coming up with all these proposals or incentives to incentivise production so I just want to plead with you, please let’s look at the positive side, let’s not dwell on the negative, let’s not be driven by some of the falsehoods that are peddled through social media. You are intelligent enough to distinguish between an obvious falsehood and that which may have credibility,” he said. Minister Chinamasa said Government was working on a cocktail of measures to improve the economy.

The central bank also misled the market that upon expiry of the bond notes (when exports reach US$6 billion), and people who would have deposited foreign currency would be entitled to demand their funds in foreign currency.

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