We Don’t Have Control Of All The Forex In The System That’s Why We Can’t Control Black Market – RBZ

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Zimbabwe Hyperinflation money changer dealer forex trader, SI 127, Statutory Instrument 127 of 2021

The Reserve Bank of Zimbabwe revealed that the only way it can remove the black market is through controlling all the foreign currency in the economy. Appearering before Parliament’s Public Accounts Committee yesterday, RBZ deputy governor Kupukile Mlambo said ,as reported by Herald:

The existence of a parallel market is a reflection of shortages in the system or the wrong incentives in the system.

Clearly we have to fix that and deal with that (black) market and the best way to deal with that is to make sure the interbank rate is sufficiently priced and there is always sufficient foreign currency.

The only way we can control those kinds of markets where there is a parallel market is when the central bank had control of all the foreign currency in the system.

As things stand, we don’t have control of all the foreign currency in the system. A lot of it is outside our powers or purview and we have no way of knowing where it ends.

In other words, the deputy governor is saying that as long as much of economic activity is happening outside the formal system, it can’t do away with the black market. It’s not surprising to hear this considering that the RBZ didn’t or still don’t know where RTGS balances (bond notes, coins and electronic money) are coming from.

The latest study about “Shadow Economies” (nice term for black markets) noted that Zimbabwe has the second largest black market in the whole world, which accounts for 60% of the total economy. Let’s hypothesis that, it is that 60% of the economy which also holds 60% of the total forex. In that case, RBZ would need the government to formalise that significant informal economy to control the black market which I think is a tall order.


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  1. Imi Vanhu Musadaro

    This idea of the RBZ *controlling all the forex* is just a petty excuse to be kingmakers. With power over all forex, they can decide who thrives and who folds, making everyone else a pawn in the system. They can regulate the forex usage and trading, but why have control over it?

    It is their business to control the local currency, but they aren’t doing that. New notes were awash on the black market. And the central bank “claims” they do not know how they got there, yet they are the root source of all issued notes.

    Does the Reserve Bank of South Africa control ALL the forex in SA? No. Do they have a thriving black market? No! And, this despite the hefty commissions charged when you change money in SA.

  2. Anonymous

    The way i see this, RBZ will never be in a position to “control all the forex” There are a couple fundamental policies that will need to be in place before they can control anything. Firstly, the soon (when ever that maybe) introduction of the new Zim dollar will never work. There is no economy to back the new Zim dollar so i would fully expect that once this is introduced, we will see a steady decline in its value in regional markets as well as in Zim. Now that we have established that there is no economy in Zim, the RBZ’s fantasy of controlling all the forex will be just that, a fantasy. With no way of drawing your money out of the bank freely, because there is no economy, the shadow economy will forever continue to succeed. Pushing the Interbank rates up is only pushing the shadow market rate up as well. As an individual, try and draw US$ out of your bank account, you can not easily do this. Even trying to draw the bond note out of your account is a huge challenge. You can not get your salary pay from the bank in bond notes, so therefor, the shadow economy will succeed. Only way that i see the RBZ having any major control is for government to do some thing to resolve the economy.

  3. Anonymous

    We should just do away with bad money! Period

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