Industry warms up to bond notes

04 Dec, 2016 - 00:12 0 Views
Industry warms up to bond notes

The Sunday Mail

Livingstone Marufu —
THE Grain Millers Association of Zimbabwe (GMAZ) has welcomed the introduction of bond notes saying they will improve liquidity and potentially shore up demand for goods and services which has been nose diving.

GMAZ chairman Mr Tafadzwa Musarara told The Sunday Mail Business last week that the sector “fully subscribes” to the Reserve Bank of Zimbabwe’s intervention.

“We are very happy with the bond notes as they are improving the liquidity situation in the country and consumers are free to buy our goods from different wholesalers, retailers and shops using the bond notes.

“As millers we fully embrace the bond notes as they will ensure money will circulate within the county’s boundaries and at the same time incentivising our exporters,” said Mr Musarara.

Confederation of Zimbabwe Industries (CZI) president Mr Busisa Moyo also weighed in: “Bond notes will go a long way in improving (the) transactional liquidity situation in the country as well as improving the sales and volumes of the local products which were included under Statutory Instrument (SI) 64. “It also allows the exporters to reduce prices of their goods so that they can compete internationally and regionally.”

Mr Moyo suggested that the RBZ could raise even more foreign currency if it increased the export incentive to between 15 percent and 20 percent. He believes that incentivising exporters would help them improve the quality of their goods abroad.

“This will improve the liquidity situation in the country as our exports will fetch more money than they are as they would have been improved from the raw state to a semi-finished or finished product,” said Mr Moyo.

Confederation of Zimbabwe Retailers president Mr Denford Mutashu said despite having a few challenges in the first quarter of the first day, retailers have fully embraced bond notes.

“As retailers we are very happy with the bond notes as they have made our transactions easier. We are accepting them as they have helped us and they have timely come ahead of the festive seasons when transactions are at their peak,” said Mr Mutashu.

He urged the RBZ to issue more bond notes to respond to market demand. The RBZ is introducing bond notes in phases to mitigate inflation and other vices that might scupper their success. Last week, the RBZ put US$10 million worth of bond notes into the market.

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