On Wednesday, a top Treasury official announced that Zimbabwe would settle pending allocations of Forex owing from auctions by the central bank within 45 days, with merchants and companies anticipating a $200 million shortfall.
Last year, the bank began holding foreign currency every week to boost dollar reach. But, traders from three different banks and two executives from a business lobbying organization claimed that successful bidders are waiting for seven weeks to meet their allocations, affecting company operations.
Without offering a figure, George Guvamatanga, Finance Ministry Secretary, said they could manage these pending. George said they want to reassure traders that the auction system’s backlog will be cleared in the coming 45 days. They know about the backlog and how to deal with it. “In an online site, Guvamatanga stated.
Since January, the Zimbabwe dollar has fluctuated around 85 cents to the US dollar, prompting businesses to accuse authorities of manipulating the trading rate. However, the bank is denying it. 1 US $ may sell for Z$150 in the illegal market, and many firms and people who cannot purchase money through auctions do so there.
According to Guvamatanga, the illegal market accounts for just 10% of overall foreign currency demand and cannot affect the trading rate officially. The country is long suffering from a persistent scarcity of dollars, making it challenging to purchase medications, gasoline, and power and causing delays in the repatriation of investors’ funds.
As per the claims by Guvamatanga, banks had Forex of $1.7 billion deposits but were never credited to accounts of companies, resulting in dollars demand for the auction purpose. The majority of Zimbabwe’s foreign money comes from Diasporas remittances and deep mining.