Negotiations underway to expand facility for bond notes

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NEGOTIATIONS are underway to expand a facility for bond notes which could see more entering circulation.
The Reserve Bank of Zimbabwe had vowed not to release more than 200 million dollars’ worth of the notes when they were introduced eight months ago, to ease chronic shortages of US dollars.
Bond notes are backed by a loan of 200 million US dollars from the Cairo-based African Export Import Bank.
So far $160 million has been released, according to John Mangudya, the RBZ chief.
Mangudya says there are now plans to negotiate for an expansion of the Afreximbank loan, once the $200 million figure is surpassed.
He told the private Standard newspaper this could mean more bond notes on the market.
Bond notes were greeted with scepticism when they were released in November, amid fears they could fuel hyper-inflation that forced Zimbabwe to abandon its currency in 2009.Advertisement