Bid to tap forex not easy

Godfrey Marawanyika

PLANS to have Zimbabweans living abroad repatriate money through official channels might turn out to be ineffective in the short-term rather than the quick-fix strategy which the central

bank is hoping for, unless issues pertaining to an attractive exchange rate are resolved.



Analysts said the programme, just like the New Partnership for Africa’s Development (Nepad) which promises improved political and economic management in return for increased foreign aid and trade, might yield more talk than action if some of the concerns that led to Zimbabweans fleeing the country are not addressed and confidence in the country’s political administration restored.



The new programme is the brainchild of the Reserve Bank of Zimbabwe (RBZ).


The last such initiative mooted to lure Zimbabweans to invest back home was coordinated by Africa Investment Ltd led by prominent business tycoon Mutumwa Mawere who was targeting Zimbabweans living in South Africa. Although the drive received much publicity little is known as to its outcome and who benefited from the scheme.


This week the lead coordinator of the RBZ drive, chartered accountant and economic analyst Eric Bloch, said he was optimistic that they would get a positive response from Zimbabweans in the diaspora.


“We are optimistic that the proposals will be successful,” Bloch said. “As a committee we have come up with a set of proposals but we do not have a specific rate on what the applicable rate should be. What we want is people to invest their money through the official channels not at the black market where they risk being duped of their money that would have been sent from abroad.”


Last week Bloch said there were 3,4 million Zimbabweans living abroad which he hoped would repatriate their money through the official channels. Since 1999 Zimbabweans have been leaving the country in droves as they seek greener pastures and better working conditions.


Some individuals who have been leaving Zimbabwe did so because of political persecution.


A bank economist who spoke to businessdigest on condition of anonymity because of the company policy said the Bloch-led initiative appeared to be good on paper, but his main problem would be that of government’s perception and why individuals ran away from the country. He said it was also important for citizens to have confidence in the banks, which would be handling their funds.


“So far everything appears to be good on paper that Bloch has to convince Zimbabweans outside the country to repatriate their money through official means. But the biggest question that has to be answered is: Is the government prepared on the other hand to address why these people left the country?” the economist asked.


“The government should come out in the open over this initiative and guarantee these people that their money will not be tampered with if it is not for immediate consumption just like what they do with individual foreign currency accounts.”


He said some of the issues that government must be prepared to answer also pertained to the issue of the ability to vote from wherever they would be, but warned that this was not about being patriotic. Zimbabweans have not been allowed to vote through postal ballots as the process has only been limited to embassy personnel and military attachés something Bloch agrees needs changing.


“In my personal opinion I think these people should be accorded the right to vote. But this is a constitutional matter which our committee cannot deal with,” he said.


Although Bloch refused to shed light on what rate the committee was prepared to give Zimbabweans abroad, this paper has it on good authority that it was somewhere between $5 000 and $6 000 against the greenback, but the rate would fluctuate depending on the applicable auction rates prevailing then.


Witness Chinyama, a Harare-based economist with Kingdom Financial Holdings Ltd, said for the scheme to be attractive everything hinged on the issue of the rate offered.


“If they can offer alternative rates which are higher than the auction rate the better,” he said. “This is because not everyone is getting money from the auction so the question which has to be addressed is where are those that have been denied access to forex getting their money from? Those who are sending their money are mostly doing it to support their relatives so if they get a better rate they are bound to assist. But what should be clear is that not everybody is prepared to invest because people left for different reasons.”


Under Bloch’s committee they have since said that anyone investing in Zimbabwe will not be subjected to double taxation, and their legality of staying in those countries will not be asked.