RBZ “SI 127 is not designed to harm business”

Valentine Muhamba Avatar
RBZ building, Reserve Bank of Zimbabwe, RBZ Fintech Sandbox, Forex Auction, Statutory Instrument 127 of 2021 SI 127 2021 industry

In some near midnight tweeting, the Reserve Bank of Zimbabwe (RBZ) posted a thread clarifying Statutory Instrument 127 of 2021 (SI 127 of 2021). Here’s what the central bank had to say:

SI 127 more about the Forex Auction participants according to the RBZ

Fair enough… the provisions for companies that participate in the Forex Auction that ensure that they use the funds procured for their intended purpose(s), were robust and makes sense.

Again no qualms here…

A level playing field is what SI 127 is apparently all about

This is something that we talked about on our Technikari podcast. The assumption we made is that SI 127 of 2021, is a price control measure because businesses have to go by the forex auction rate. As I am sure you are all aware the parallel market rate is leaps and bounds ahead of the auction rate.

ZIMNAT’s potential implications of SI 127 of 2021

The estimate we have is that it’s around the region of ZWL$120 to 135 for US$1.00. Now in this scenario consumers are more likely to go and change their USD at the parallel market rate to try and edge out the retailers. On the other end of things, suppliers and outlets will price products higher in USD terms to make sure they get around about the same they were getting in local currency before SI 127 of 2021.

A good example of this, is a tweet by journalist Hopewell Chin’ono:

You can still buy goods and services in forex (but we already knew this)

SI 127 never said anything about banning the use of USD to make purchases but maybe this was something the RBZ saw on its end and is trying to dispell any who held this misconception.

Businesses given 2 weeks to get receipts in order

This part is the interesting bit, because there was a memo that was sent by OK Zimbabwe to all its branches saying they were to stop receiving USD payments because under SI 127 businesses now have to issue receipts according to the currency used by the buyer.

According to the Memo, OK hadn’t yet calibrated its tills to make the distinction between USD purchases and local currency ones.

“One will be guilty, if he or she, being a seller of goods or services, issues to a buyer thereof a receipt in Zimbabwe dollars for payment received in foreign currency, or records sales other than in the currency in which the sale was conducted.”

Statutory Instrument 127 of 2021

It might be a case that this wasn’t clearly communicated and OK Zimbabwe jumped the gun. But it’s good that RBZ made this point about SI 127 clear.

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  1. Edwin chiduza

    ooooh shame!!!! zvatanga futi

  2. Mike Rukwava

    My question is: How many people are getting USD using the RBZ auction system? We can’t suffer because of selected few.

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