Finance Minister Mthuli Ncube has said the printing of new $10 and $20 denominations does not translate to the Reserve Bank of Zimbabwe (RBZ) printing more money, but it was merely swapping RTGS balances into hard cash.
The RBZ this week put into circulation new $10 notes while $20 notes will start circulating during the first week of June.
This has raised fears among Zimbabweans the central bank was illegally printing more money, which could further accelerate the country’s hyperinflation with more increases in prices of goods and services reminiscent of the former RBZ Gideon Gono era.
However, Ncube allayed the fears and said the government was trying to ease the country’s perennial cash shortages characterised by snaking queues outside banking halls and the buying of the Zimbabwe dollar on the black market.
Speaking to journalists at the burial of national hero, Absolom Sikhosana in Harare Wednesday, Ncube said government was only swapping RTGS balances for hard cash in the form of $10 notes.
“This we had already planned, we did tell you that we were going to release the $2, $5, $10 and $20 note,” he said.
“We are trying to ease the cash shortage and narrow the gap between the RTGS and the cash version of the Zimbabwe dollar, it almost constituted tax on people but the way we are doing it is careful.
“We are doing exactly what we said we will do, we never deviated.”
Asked whether printing of money without any significant industrial production was viable, Ncube said his government was more concerned about easing the cash crunch and increasing production.
“We are producing, we want more productivity, we have a cash shortage and we are walking the talk on increasing the cash in circulation.”