By Connor Clayton
ZIMBABWE’S adoption of South Africa’s rand as its main commerce currency will encourage foreign investment and attract expats.
This is the upbeat assessment from the Zimbabwe Area Manager of one of the world’s largest independent financial advisory organisations, which has US$10bn under advice from 80 000 mainly expatriate clients globally.
Shane Helberg, deVere Group’s Area Manager of Zimbabwe, Botswana and Mozambique, said: “The Zimbabwe’s adoption of the Rand as the main trading currency within the country’s multi-currency system should be championed.
“Whilst the rand perhaps isn’t as weighty as the U.S. dollar for international trade as it’s more volatile against major currencies, it must be noted that the dollar has not been effective in arresting the freefalling economy in recent times. Using one primary currency, the rand, for commerce is likely to be beneficial for several key reasons.
“First, it is better to move to using one single semi-convertible currency than a multiplicity of currencies at the moment as it reduces confusion and uncertainty. Stability and certainty is always welcomed by foreign investors.
“Should the move prove to be successful, we can expect further levels of foreign investment and, in turn, more expats moving to Zimbabwe. Clearly, international organisations and people bring with them a raft of potentially enormous associated economic benefits to any host country. As such, Zimbabweans and expats already in the country will be thankful that a single currency could replace the current variety of currencies used for the added economic stability it will likely generate.
“Second, the measure should also help boost trade links with South Africa, Zimbabwe’s major trading partner. This is especially importantly for Zimbabwe as it will make China, amongst others, more confident about investing in the country if it helps stabilise the economy. And third, it will increase Zimbabwe’s competitiveness in broader global terms as it will make exports cheaper. Also prices in Zimbabwe will go down,” Helberg said.
Helberg added that: “Should the rand become the defacto currency of Zimbabwe, which we believe it will, the country’s economic woes could seriously start to diminish. This would drive confidence in Zimbabwe as being a place to do business and invest.”
He concludes: “These are exciting times and deVere is happy to be one major global brand that is currently using its resources to develop its presence in the country with its strategic and ambitious growth plans for the longer term.”