After years of what we thought were unfounded conspiracy theories, today the Reserve Bank of Zimbabwe Governor, Dr. Mangudya has confirmed your worst nightmare. Dr. Mangudya has confirmed that a secret group of people is making the black market flourish. And he went on to question the competence of the Financial Intelligence Unit (FIU) and the Central Intelligence Organisation (CIO) in failing to catch these “influential people”. The Governor said;
Those figures of foreign currency being bought or sold for up to six times its value were computer-generated…The people moving money onto the black market, the people behind the money changers are not your ordinary Zimbabwean…These are influential people with access to huge sums of cash. It has been discovered that one character has been pushing onto the black market as much as $48 million in foreign currency. This person has access to cash and it is difficult to understand how this could have happened without the knowledge of the CIO, the FIU, the police as well as the commercial bank. The meeting called by the President could trigger a nasty fall-out and there is already gnashing of teeth. Some people have a lot of explaining to do and heads will roll…The bank does not participate in parallel market practices…we have been investigating and if you have any information, please bring it to us.
Whilst I don’t really know what part the CIO has to play in stemming black markets, FIU seem to have been incompetent on this score (that’s if it’s ever competent at all). Since cash burning resurrected a couple of years ago just a measly number of moneychangers have been arrested for illegal money changing activities. Yet in the Central Business District, I see money changers standing at corners with a bunch of monies.
I need not even talk about the police, the police are ever-present in town chasing vendors, kombies but I have never seen money changers being chased. No wonder people develop some conspiracy theories that elite people are running the black market.
Beyond the due diligence that banks conduct through their Know-Your-Customer policy, I don’t think banks have any other way of stemming black markets. That’s for FIU and the police. Surely if banks are not practicing due diligence within its scope, the RBZ would notice it under its Bank Supervision function, isn’t it? Unless the RBZ itself is not competent and just playing the blame game.
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You don’t know how the CIO is involved in stopping this? Or is it we are used to seeing the CIO being abused as a political weapon?
I thought only RTGS money is computer generated by the rbz itself. How does anyone else create fake United States Dollars through the computer? Both the governor and the writer missed the point. The problem of the exchange rate will not be solved even if the police is 100% efficient in arresting money changers. As long as demand is more than supply the price of a product will go up. Except for the small list of basic products monitored by the government, retailers can raise the price of any other product without breaking any law. Let’s say all the people who somehow get hold of US dollars hand them over to the RBZ which allocates that forex according to its priority list. There are goods being imported into the country which are in high demand but will probably never be on the rbz priority list – for example building materials such as tiles, bathroom sets, electricals, cell phones, computers, televisions, cars, car parts, “luxury” food stuffs, dstv subscriptions, etc. Sooner or later those individuals earning their own forex will simply find no reason to hand over their dollars to the rbz and will instead start to import those products they care about for themselves without breaking any law. Someone who is on the market for a new cell phone will not mind paying a premium price for it and the exchange rate disparities will start. Remove the rbz priority list and let oil companies source their own fuel. People will decide how to allocate their little forex according to what is important to them.
I support that the so called priority list is fueling black market they are getting it 1 : 1 and sell it at premium can we have audit how the so called priority list used their money
Churches are also actively involved in money changing some even employ full time persons
Which churches?
Markets do not need to be forced you need to set up a system that manages markets according to your desired levels
The rate will be 1:1000 by weekend while RBZ Governor professes ignorance of who the culprits are…just remove the bond from the street…and black market will be extinguished ka1… Hapana zvinonetsa…
the ngwena twins
Why is the Governor not naming them..! As long as the country is not exporting the situation will continue.You can not borrow money to buy consumables (fuel,wheat,medication) and expect things to normalise.We need to export for us to generate forex.
I’m surprised that techzim would write such an ignorant article. I genuinely thought you were more informed than this. This is just another example of Zimbabweans blaming some nonexistent boogieman for their problems. The money changers are not some evil criminals that plot to bring down the country in the dark. They are the normal people. They are our grandmothers and our teachers and our university students. Everyone in zimbabwe changes money because they want to preserve the value of their meagre salaries. If you want to travel, if you are a supermarket who wants to restock, if you want to buy something which is increasingly being charged in USD right here in zimbabwe where do you think you will get the USD from? You have to buy it on the black market obviously! That would mean we would have to arrest every productive person in Zimbabwe. Maybe the problem is we don’t trust our banking system to protect our money and we don’t trust the ministry of finance or rbz (whoever is in charge) to maintain its value. Maybe the problem is we don’t produce anything and there is too much money chasing too few goods. Maybe the problem is whoever has access to that 48 million was allowed to withdraw it as cash at 1:1 and the government won’t accept that. The government persistently maintains this arbitrage opportunity and they expect that it won’t be abused. That’s denial in my opinion. I wish mthuli well in his efforts and I hope Zimbabwe eventually makes it but police don’t fix economies, economists do.
Well put. That’s the truth brother
Governor name those chief culprits so that they get arrested so that the life of an ordinary Zimbabwean can move forward
Its one of those statements that do nothing to help the issue, that leaves more questions than answers. If they are known, why are they not arrested already?
It has always been evident that some cartel of sorts is running this big money exchange unofficial bureau. The clean notes with sequential USD serial numbers betrayed this. I’m surprised though, that RBZ guvnor seems to have resigned to what’s going on instead of offering solutions to end it. How about tracing the USD notes from the RBZ (assuming all USD notes’ records are known to them). I remember during the exchange control days when a passport used to be stamped on each occasion of forex purchase and serial numbers of the notes recorded. If these transactions are outside Police, RBZ or Banking “scope” well ,what does it tell us about the mythical “national security”? At this juncture why do we need RBZ, FIU at all for? They should be disbanded forthwith for they serve no function and are “emasculated” sorry for the pun..
How do you expect the FIU to know anything when you are leaving us the ppeople who studied such issues unemployed?
All you guys talking about exposing or arresting the saboteurs are falling hook, line and sinker for this propaganda from rbz chief. There is nothing the FIU can do to correct the exchange disparity between real and imaginary money. The problem simply boils down to the very deceptive nature of the bond notes and rtgs balances. The rbz can’t generate 10 billion dollars from nowhere and say it is equivalent to 10 billion US dollars. If things were that simple then why stop at 10 bidza, why not a billion trillion then we will instantly be the wealthiest country in the world?