RESERVE Bank officials have found a convenient Trojan horse to devalue the local currency without provoking President Robert Mugabe’s ire. They merely raise the diaspora rat
e of exchange to remove the lustre from the black market.
Their efforts have often come short.
Sibonile Moyo sits on a make-shift stool fashioned from a disused metal crate, a length of lace cloth material spread over her lap, ready to wrap it round her head into a neat, flat-topped turban. Behind her are rows of neatly arranged cosmetics in faded packages and motley trinkets that appear to have remained unsold for ages.
Moyo is among scores of women who stand to lose business if police continue their crackdown on informal foreign currency dealers.
The white lace turban is now an identity tag for women who depend on exchanging foreign currency on the streets of Bulawayo, Zimbabwe’s second largest city, for a living.
“If police continue like this we are all finished,” Moyo bemoans. As a single mother she fears losing her only means of providing for her family.
Scores of women have moved to Bulawayo’s Lobengula Street and Fifth Avenue from towns and cities around the country, swelling the numbers of informal foreign currency dealers who prowl the city’s streets in search of customers.
They have gotten used to scouring the pavements along a section now commonly referred to as “The World Bank”, discreetly asking whoever they think intends to exchange the local currency into pula, rand, pounds sterling or greenbacks, or vice versa.
Past police blitzes on black market forex dealers, which threatened to send Moyo and those of her ilk’s “business” over the edge, have not dampened the women’s determination.
Police spokesman Inspector Smile Dube said police would “not rest until we stop their operations”.
He said police were now aware that forex dealers had changed their style of operating. “We will get to the bottom of it all,” said Dube.
An Anti-Money Laundering Act provides for the police to search persons they suspect of holding large amounts of cash without a warrant in cases of emergency. The regulations have done little to discourage informal foreign currency traders who continue doing their business, spurred by the lucrative exchange deals.
The introduction of large $20 000 “bearer cheques” after Zimbabwe experienced the worst ever cash crunch last year has enabled the women to conceal large amounts in smaller pouches that are hard to detect.
Such is the magnetism of informal forex trading for the women that at one time Reserve Bank governor Gideon Gono disguised himself at flea markets in Bulawayo and Victoria Falls to see for himself what it is that emboldens them to take risks to defy the law.
“We have provided an essential service for those that work in Botswana and South Africa coming on holidays, but the police do not recognise that. Instead they arrest us and confiscate our money, blaming us for the shortage of foreign currency,” complained 33-year old Zodwa Muraisi.
“It is a cat and mouse game here. To succeed, one always has to keep a step ahead of the authorities,” Muraisi says mimicking a popular ad-line from a major commercial bank.
The central bank announced last week a new exchange rate of $6 200 to the American dollar, 11% higher than the previous benchmark of $5 600. Informal traders offer up to $8 000.
Stringent monetary measures to curb forex leakages and shore up dwindling official reserves have failed to staunch illegal dealings on the parallel market.
Economists hailed the steps taken by the central bank and predicted the measures would “destroy” the thriving illegal foreign currency market largely blamed for stoking hard currency shortages and negatively impacting on the economy.
But economic commentator Eric Bloch says unless the measures taken by the central bank are reinforced by political commitment on the part of government on exchange rates, the informal market will continue to thrive.
Eddie Cross, the opposition Movement for Democratic Change economic advisor, scoffed at the central bank’s ineffectual efforts to stamp out informal foreign currency dealing.
He said the current practices of attempting to manage and manipulate exchange rates would not work. “The only real market arbiter remains the street – dangerous, illegal and inefficient,” Cross said.
For Moyo and Muraisi the informal currency market has been a steady means of earning a living and they vow to continue.
“We offer customers better rates than the banks. That is why people prefer to deal with us than the banks,” boasted Muraisi.