By Alois Vinga
THE Reserve Bank of Zimbabwe (RBZ) has stepped in to allow the settlement of transactions made prior to dedolarisation in a move aimed at protecting those who entered into contracts prior to the policy’s inception.
In a letter written by the RBZ exchange control director identified as Charity Tembo to chief executive officers of all banks, the Apex Bank said an allowance to receive their foreign currency payments has been granted.
“The Nostro FCA domestic was funded from local foreign exchange transactions and in view of these new policy measures where the Zim-dollar shall be the sole legal tender existing, Nostro FCA shall be allowed to receive deposits up to June 30, 2019, to enable account holders to deposit their cash realised from trade undertaken before June 24 2019,” the letter says.
According to the RBZ, companies have been directed to liquidate the US$ they are holding in their FCA accounts at the prevailing interbank rates for the settlement of all local transactions but they can still use the foreign currency to settle international obligations.
The Central Bank has also removed the privilege for corporates to withdraw money in foreign currency without a maximum daily limit. A justification will now be demanded, while the amount of cash in transit or baggage when leaving the country remains at US$ 2 000 among other measures.
All banks have also been asked to transfer registered local currency balances which are a part of the legacy debt to the RBZ.
The monetary authorities have also proposed to remove administrative limits on the operation of bureau-de-change and on the cap on margins for banks for interbank foreign exchange transactions, as well as to put a ‘vesting period’ of 90 days on disposal of dual listed securities or shares purchased by investors on the Zimbabwe Stock Exchange.
Apart from the individual FCAs , all accounts are expected to be funded externally through offshore and non citizen sources.
Market analysts have predicted that the combined effect of these proposals is meant to choke the parallel foreign currency market while skepticism has characterised the long-term impact of these measures.