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CURRENCY SPECULATION NOT JUSTIFIED, SAYS MTHULI NCUBE

Mthuli Ncube Rules Out Scrapping 2% Tax
Mthuli Ncube, is the Finance Minister in the Zimbabwe cabinet appointed by president Emmerson Mnangagwa and past chief economist and Vice President of the African Development Bank.

Finance Minister, Professor Mthuli Ncube says currency speculation is unjustified in Zimbabwe.

Speaking in Parliament he said : “I thank the Hon. Member for that very important question. It is very important that we should protect our currency and keep it stable and discourage unnecessary speculation. The speculation is unjustified.

It is clear what the fundamentals are that drive value, that underpin the value of this currency and therefore it should be clear to everybody that this currency should be stable and appropriate official exchange rate should be used for transaction purposes.

In our desire to protect that Mr. Speaker Sir, we are putting certain measures, certain sanctions on those who deviate from that objective.

First of all, for those who are managing retail or own retail organisations and sell goods to the public, we are insisting as Government that they ought to use the willing buyer-willing seller price for foreign currency as the basis for pricing.

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What we did last week after my presentation here to this House to the joint Budget and Finance Committee and also the Committee for Industry and Commerce, I did undertake that we will remove the 10% limit for certain prices and that was removed and it was subsequently brought to this House and we debated it, the House approved it and we are very grateful. We have removed any basis to deviate officially from the official exchange rate, that 10% exchange limit was causing deviation as an excuse for overpricing purposes. So, from now going forward, we make use of the willing buyer- willing seller pricing mechanism and any deviation will be sanctioned through a fine of no less than ZiG 200 000 per offence. So that is really the measures we have put in place to deal with the pricing by retailors.

On individual trading on the streets and so forth, clearly, they do so without any licences, they are violating the exchange control regulations and the law has taken course of those that have violated and we have seen a few or more than 70 individuals being arrested.

Police have done their job and some of them have appeared before the courts so that they face justice and stop what they are doing. It is very important that we must all abide by the law to protect our currency.

After all, that is the only domestic currency we have. The other currencies are actually foreign currencies and we cannot develop a country without your own currency, neither can we have a full bouquet of micro-economic tools without our own currency and monitory policy. I submit, thank you Mr. Speaker Sir.

Also read: STATISTICS SHOWS HALF OF ZIMBABWE POPULATION NEED FOOD AID

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I thank Hon. Mavunga for that supplementary question. Yes, the Financial Intelligence Unit has been effective in investigating illicit activities, money laundering and other aspects and in fact, triggering the sanctions on those who are deviating from the prescribed exchange rate or pricing frameworks, but of course, we can never say they have all the capacity they need.

In fact, they have written to me to say Minister, we need more capacity and I have granted that and we will be giving them more resources so that they can hire more personnel equipment or whatever they need like tools of trade to remain effective on the ground, but that is one hand. Hon. Mavunga wanted to know more about the police side.

Again, we have said to the law enforcement agents, the police that if they need additional capacity, we are happy to support that whether it is equipment mobility, we have to support that because this is an important issue.

I can assure him and I can assure the nation that we really mean business and we will make sure that our law enforcement agents and agencies are equipped enough to deal with the situation. I thank you.

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