RBZ projects US$12 billion receipts by year end, says exchange stability is here to stay

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By Alois Vinga

RESERVE Bank of Zimbabwe (RBZ) has projected record breaking foreign currency receipts by year end, in the margins of US$12 billion amid assurance that the prevailing exchange rate stability is not a short term measure, but will spill over into 2023.

The remarks come shortly after the visible impact of inflation containment measures put in place by authorities to contain spiralling inflation which skyrocketed mid- 2022 to the current 3,5% monthly inflation as at September 30 2022.

The depreciation of the Zim$ on the parallel market has also eased with the gap between the two premiums edging towards convergence.

Sound banking practices anchored on reliability guaranteeing the public to withdraw their foreign currency from local banks, as opposed to past incidences where such deposits ended up being nowhere to be found has also bolstered confidence, partly leading to an ever foreign currency base for the economy.

Speaking to legislators at the 2023 Pre-Budget Seminar in Harare Friday, RBZ governor John Mangudya said foreign currency receipts have been rising amid expectations to hit around US$12 billion.

He said foreign currency remains stable with exports and foreign currency receipts totalling US$8,4 billion as at September 30 2022 compared to US$6,1 billion payments during the first nine months of the year.

“That gives us a positive balance of US$2,3 billion. That money is seated in banks at US$1,4 billion and close to US$1billion being loans in foreign currency which banks have given to their customers.

“The numbers are positive and banks are doing their level best to assist their customers. US$9,6 billion for 2021 was the highest ever foreign currency earning this country has received apart from 2013.

“This year we are expecting to be above that, maybe around US$11 or US$12 billion by the end of the year,” said Mangudya.

Breaking down the figures as at September 30 2022, Mangudya said export proceeds stood at US$5,4 billion for the nine months of the year compared to US$4,1 billion last year while diaspora remittances were at US$1,2 billion in the first nine months of the year compared to US$1 billion last year.

Embassies and NGOs brought in US$860 million during the period US$708 million last year with foreign investments having also gone up from US$53 million to US$131 million.