Shift to rand unavoidable, says Zim executive

(iStock)
(iStock)

Harare – Zimbabwe should make a rapid shift to the use of the rand as dollars are getting scarcer and scarcer, according to a leading banker.

“A shift towards the rand is inevitable as dollars imported to facilitate transacting do not stay within the country,” Zimbabwe Stock Exchange-listed FBC Holdings chairperson Herbert Nkala said at the launch of the 2016 CASE Handbook on Wednesday.

Nkala said while the multicurrency system is certainly the only way forward, the country needs something people will have confidence in.

“My view is that while the rand is certainly not ideal as South Africa has its own issues, we import most things from Mzansi – we just need to be realistic and embrace the rand,” said Nkala, adding that “the alternative is not attractive.”

Nkala noted that dollars are getting scarcer and scarcer as certain individuals continue to externalise notes.  “We all know who the culprits are.

“Almost certainly the easiest way forward is to move increasingly to the rand. It does not have the desirability of the US dollar, but at least there is relative confidence in the unit. The quicker this happens in this country – dual pricing and the like - the softer the landing we are going to have in the months ahead.”

Nkala said it does not matter how many dollars are imported as the problem will remain, because of the attractiveness to the region of Zimbabwe’s usage of dollars.

Company of the Year award

Following his address, Nkala presented Art Corporation with the 2015 Company of the Year award for recording the best share price performance on the ZSE in 2015. The company rose 233.3%, gaining an additional 40% since January 1.

The CASE Handbook profiles over 120 listed companies in Botswana, Malawi, Zambia and Zimbabwe, providing financial results and prospects in the year ahead. It also includes a five-year trading summary, highlighting the past year.

ZAR/USD
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18.95
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(-0.20)
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