Forex Auction: ZCTU Slams Businesses For Double Dealing

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By Alois Vinga

THE Zimbabwe Congress of Trade Unions (ZCTU) has slammed some local businesses for enjoying access to foreign currency at the official rate while unfairly pricing their goods and services using parallel market rates.

Recently, the Reserve Bank of Zimbabwe (RBZ) published a list showing that since the inception of the Foreign Exchange Auction system in June 2020, almost US$1 billion was availed to companies at the official exchange rate which is below $85 for every US$1.

Companies like Cangrow, Stanbic Investor Services, Blue Ribbon Foods and Surface Wilmar are part of the top 10 beneficiaries on the list.

Several companies have since commended the auction platform for achieving pricing predictability and boosting revenues when compared to previous years.

However, many of these companies have not demonstrated equivalent reciprocity as many continue to charge for their goods and services at prices far above the official rate.

Speaking to Saturday, ZCTU secretary general, Japhet Moyo denounced the conduct, adding that unions were inundated with complaints by some employees who felt short-changed by the unscrupulous practice.

“It is ethically wrong for businesses or any company to charge for goods at prices above the auction rate when they are the beneficiaries of the RBZ auction system.

“What boggles the mind is that everyone is aware that the practice is prevalent, but no deterrent measures are being taken against such malpractices,” he said.

He accused influential members of society for allegedly fleecing consumers using the practice and questioned why the majority of benefitting companies were paying workers in RTGS even when the firms were trading in US dollars.

Market watchers remain divided on the exact measures to be taken against such malpractices with some urging authorities not to implement harsh measures for fear of eroding confidence in the auction while others believe that deterrent measures must be put in place if the gains of exchange rate stability are to be maintained.