15 March 2019

Zimbabwe: Prof Ncube Comes Clean On Zim Currency-RTGs Dollar Is Official Currency

Photo: The Herald
Finance and Economic Development Minister Professor Mthuli Ncube poses for a photograph with his briefcase before presenting his 2019 National Budget proposals in Parliament.

The local surrogate currency formally known as Bond Note and recently christened the RTGS dollar is legal tender whether citizens like it or not, Finance Minister Mthuli Ncube said Thursday.

Ncube was speaking at the inaugural Youth Indaba, organised by Ministry of Youth and attended by hundreds of youths from all the country's 10 provinces.

"We have introduced the RTGS dollar. Citizens have to accept the introduction of the RTGS dollar. Whether you like the name or not, it is the domestic currency now, let's respect it and support it," Ncube said.

"I and the Governor (of the Reserve Bank, John Mangudya) are going to defend it. Defend its value, that's our job."

Announcing his monetary policy statement last month, Mangudya introduced what he called 'RTGS dollars' but came short of specifically referring to it as the country's official currency.

Ncube added that his message to investors has been that Zimbabwe is ripe for investment.

"Zimbabwe is the cheapest buy in Africa in terms of investment. It has gotten cheaper because there were coming at $1US to $1 bond note, now they are coming at US$1: RTGS$2.50 or depending on where the market is headed," he said.

The Treasury chief warned however depending on market forces, there are bound to be fluctuations either way.

"But then it (value) can go anywhere. It is the business of the market. Our job is to manage the volatility, but not the level. Those of you who did statistics there is a difference between standard deviation and the mean," said Ncube.

For over a year government held out claiming the Bond Note and the US dollar had the same value before last month's capitulation.

Government as part of the new monetary regime also introduced Bureau de Change and allowed for the first time in years banks to trade in foreign currency but also added the local RTGS into the basket of currencies on trade amid an initial fixed rate subject to market fluctuations.

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