Maravi

(NEWZIMBABWE, REUTERS) Zimbbawe moves closer to rand

Zimbbawe moves closer to rand
by
07/07/2009 00:00:00

ZIMBABWE will look into the possibility of adopting the rand as an alternative to the country's existing multiple currency regime, Zimbabwe's Industry and Commerce Minister Welshman Ncube said on Tuesday.

"We cannot re-enter the Zimbabwe dollar without the economy to support that, we need another solution. We cannot continue forever with multiple currencies," Ncube told an Africa forum in London.

"If we can at least join rand monetary union, we will have money allocated to Zimbabwe through that system. No decision has been made, we will debate it and see what the best alternative is."

Finance Minister said on Monday that the country not return to using its own currency in the near future, and any move back to the Zimbabwe dollar will be linked to export strength.

“It is not our intention to depart in a hurry from the regime of multiple currencies that we are using at the present moment,” Tendai Biti said in an interview with Reuters television.

“There is no reversion to the Zimbabwe dollar at all. If it happens, it will depend on the performance of our economy, the performance of our exports. We are still a very, very long way to the return of the Zimbabwean dollar.”

Zimbabwe has allowed the use of multiple foreign currencies since January to stem hyperinflation which has left the Zimbabwe dollar almost worthless in the midst of a severe economic crisis.

President Robert Mugabe has said Zimbabwe may revive the use of its own currency because the U.S. dollar was unavailable to a majority of people in the countryside.

Biti also told Reuters that inflation would reach 3-4 percent this year, after averaging 2.0 percent over the January-June period. He said Zimbabwe needed budgetary support.

“We expect our 2009 budget to be $1 billion, I expect to collect $800 million by the end of the year. This will leave us a shortfall of $200 million.”

Zimbabwe recorded a monthly inflation rate of one percent in May.
The last inflation figure announcement before the country permitted the use of foreign currencies was in October, which showed prices racing along at a record 231 million percent. - Reuters

Labels: SOUTH AFRICAN RAND, WELSHMAN NCUBE

posted by MrK @ 2:55 PM