THE Reserve Bank of Zimbabwe (RBZ) is developing a special scheme for non-governmental organisations (NGOs) and embassies who access foreign currency for some of their operations.
An RBZ official said the scheme was intended to lessen delays in allocating foreign currency to NGOs and embassies now that the central bank had tightened the operations of financial institutions.
NGOs and embassies also use the prevailing auction rate as quoted by authorised dealers to charge for services denominated in foreign currency.
The move comes less than three months after the RBZ introduced its foreign currency auction system largely meant to solve the country’s crippling situation.
The foreign currency auction system began on January 12 with suppliers offering US$20,6 million for auctioning.
The system has resulted in the Zimbabwe dollar being devalued in disguise from $824 to about $4 138 against the United States dollar as of Thursday, February 26.
Sixteen auctions have been held so far.
The foreign currency supply had largely been from the mandatory sales to the auction upon receipt of foreign exchange by exporters, auction offers from exporters and other suppliers of foreign exchange, FCA liquidations after 21 days and other market purchases.
While the foreign exchange auction system has unlocked substantial amounts of foreign exchange, which was hanging speculatively outside the formal system, it has now met resistance from exporters because of the low rate being offered.
Individuals are still selling money on the parallel market at much higher rates than the RBZ.
The RBZ has accused exporters of still securing money from the parallel market.
“This is not on,” RBZ governor Gideon Gono told chartered accountants last month. “Those who get caught with their hands in the till will only have themselves to blame. They were borrowing from the parallel market and now expect to be bailed out by the RBZ.”
The RBZ said it was now conducting a sector-by-sector investigation to try and find out which sectors needed help.
“Some sectors are benefiting from the system yet they are not decreasing their prices,” Gono said. “They should ensure that benefits also filter through to the people. We have given manufacturers a 30% window to try and cushion them against problems that they have been facing. This should go a long way in helping them.”
In terms of the monetary policy statement announced by Gono on December 18, the central bank advised that concessionary finance at a maximum all inclusive interest rate of 30% would apply to all productive and export sectors.
Under this facility, statutory reserves contributed by financial institutions were made available to commercial and merchant banks for on-lending on a revolving basis.
Eligible productive sectors were agriculture, mining, manufacturing, construction, transport, communication, and tourism.
All small and medium-scale enterprises were eligible for funding.
Sectors not being supported by the scheme included financial and investment, financial organisations, individuals, non-governmental organisations, parastatals and quasi-governmental institutions, and passenger transport organisations.
Gono said the facility was for productive use such as plant and equipment for industrial and agricultural purposes and professional equipment, working capital, refinancing of existing debt for eligible expenditure, excluding offshore loans, as well as pre-and-post shipment financing.
Meanwhile foreign exchange inflows have risen from below US$11,7 million in November last year to US$85,4 million last month.
So far about US$60 million has been received by the RBZ for auctioning.