Companies comply with the latest regulations on the use of forex
Oliver Kazunga, Senior Business Journalist
Businesses have started to comply with the latest regulations on the use of foreign currencies while industry leaders are expected to meet with the government this week to deliberate on concerns arising from the new monetary policy regime.
The meeting is expected to weigh the implications of Statutory Instrument (SI) 127 from 2021, which was announced last week and requires businesses to price goods and services at the official exchange rate. The new regulations penalize those on the wrong side of the law, including companies refusing to transact in local dollars.
Zimbabwe Retail Confederation President Denford Mutashu said his association with the Ministry of Finance and Economic Development would host a breakfast tomorrow to discuss the impact of the new IS.
“The CZR and the Ministry of Finance will hold a joint breakfast on Wednesday in Harare before setting a date for Bulawayo and other centers.
“We will go to the market to explain the impact of the recently promulgated Statutory Instrument 127 of 2021,” he said yesterday.
“The Deputy Minister of Finance (Clemence Chiduwa) will be the guest of honor at this event and the Governor of the Reserve Bank (Dr John Mangudya) will also come and try to explain the impact of the policy on business and monetary policy. the environment as well as the general public. “
The Director General of the Zimbabwe National Chamber of Commerce, Mr. Christopher Mugaga, and the President of the Zimbabwe Confederation of Industries, Mr. Henry Ruzvidzo, will also be present.
Following the publication of the SI, some companies and retailers had expressed reservations arguing that the new regulations could upset the business mood. However, a survey carried out by this newspaper in the Central Business District of Bulawayo yesterday showed that businesses such as gas stations, hardware and retailers now accept all payment methods.
“Management has instructed us to accept the US dollar while we take care of the matter. Maybe after two or three weeks a decision would have been made to accept or reject the United States, ”said one of the employees at the OK branch Jason Moyo in Bulawayo. The retailer had temporarily suspended foreign exchange trading after the announcement.
The investigation showed that some companies used the official exchange rate set at 1: 84.71 USD, while others always set their prices above the official rate.
Despite benefiting from the forex auction platform, monetary authorities have expressed concern that companies are offering prices above the official exchange rate. Those who operate in the informal sector, a majority of them refuse local dollar transactions in favor of forex and would levy heavy premiums on those who use Zim-dollar cash or electronic money.
According to Statutory Instrument 127 of the Presidential Powers of 2021 (Temporary Measures), companies that abuse foreign currency obtained in the foreign currency auction trading system will be heavily penalized.
Under the new regulations, businesses will be fined $ 50,000 or the currency equivalent for refusing to accept payment in local currency at the official exchange rate. Financial institutions whose customers do not follow the regulations will also be fined.
Since its introduction last year in June, the weekly Foreign Currency Auction Trading has received broad support from the private sector and is credited with stabilizing the exchange rate, which has led to the price discovery. – @okazunga