Oliver Kazunga, Senior Business Reporter
THE Confederation of Zimbabwe Industries (CZI) and the private sector are rallying behind the call to promote wider circulation of the South African rand to alleviate the prevailing cash shortage in the economy.
Zimbabwe’s economy has been dominated by the United States dollar since adoption of the multicurrency system in February 2009.
CZI president Mr Busisa Moyo said increased rand circulation was crucial in the economy as he challenged the private sector to clearly demonstrate why it was calling for the increased circulation of the rand.
“If the populace is calling for the rand, that sound or that voice must really come out strong and the reasons. As a private sector, we need to play our role in clearly showing and demonstrating why we are calling for the wider circulation of the rand,” he said.
Mr Moyo said debate on increasing rand circulation in the economy was gaining momentum and thus the private sector should continue engaging the Government over the matter.
“As the private sector we must start that pricing in rand and take the lead,” said the CZI president.
Government has, however, stated that it will not adopt the rand as its main currency insisting on continued use of the multiple currency system.
The Reserve Bank of Zimbabwe (RBZ) has also backed calls to promote wider circulation of the rand and other currencies in the basket without necessarily ditching use of the United States dollar.
Despite the cash crisis, RBZ Deputy Governor Dr Kupukile Mlambo last week stressed that the country cannot adopt the rand, which is considered volatile in terms of its relations with the American dollar.
Since April last year, Zimbabwe has been faced with cash shortages and the RBZ has encouraged the transacting public to make use of plastic money and electronic payments systems to ease the challenge.
The monetary authorities have blamed the cash shortages on massive externalisation, low exports and hoarding of the greenback, which is on high demand due to its strengthening value against regional currencies.