/ 1 May 2006

Zim central bank relaxes exporters’ exchange rate

Zimbabwe’s central bank has stopped compelling exporters to sell 30% of their foreign currency earnings at an outdated official rate, the state-controlled Herald newspaper reported on Monday.

The central bank said the move is a bid to ”consolidate and support growth” in the export sector.

Exporters were previously obliged to sell 30% of their United States dollars earnings at the paltry ”auction” rate of Z$30 000 to the US currency. Zimbabwe has another ”official” rate — known as the interbank exchange rate — that is currently set at about Z$100 000 to the greenback.

The interbank rate is, however, still a long way off from the parallel market rate. The dollar was selling for as much as Z$213 000 last week on the streets, according to independent press reports.

”RBZ [Reserve Bank of Zimbabwe] is pleased to advise the market that from April 28 2006, the whole 30% portion currently being sold to the bank shall be at the going interbank exchange rate,” the bank said in a statement quoted by the Herald.

Exporters are still obliged to liquidate their earnings at the interbank exchange rate of less than half the parallel rate.

Zimbabwe is suffering from a severe shortage of foreign currency, which is affecting almost all sectors of society. There are shortages of fuel, medicines, machinery spares and some foods. The government is keen to see the export sector grow and bring in the desperately needed hard cash. — Sapa-dpa