Zimbabwe will enforce usage of the rand with exporters receiving half of their proceeds in the South African currency and shops required to accept payments in any of the multiple currencies that Zimbabwe uses as legal tender.
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Mr Mangudya also introduced a number of other measures to steer people away from using U.S. dollar cash.
Proposed notes to be at par with United States dollar.
The central bank brought in so-called bond coins of one, five, 10 and 25 cents, pegged to the USA dollar, in 2014. This is aimed at ensuring wide spread of currencies and minimise against concentration risk of using the USA dollar.
Zimbabwe once faced a cash crisis around Christmas in 2014, with long queues seen in front of banks. It, however, imports most of the industrial and consumer goods from overseas.
Zimbabwe has put forth plans to print paper notes, known as band notes, with support from the Africa Export-Import Bank.
Mangudya also announced that the central bank had tightened daily withdrawals to ease an acute shortage of cash.
The bond notes set to be introduced will support the Dollars 200 million foreign exchange and export facility which the central bank established to try and cushion the high demand for cash and to provide an incentive facility of 5 per cent on all foreign exchange receipts on tobacco and gold sale receipts.
The Zimbabwe People First party, which is headed by former vice president Joice Mujuru said in a tweet: “The planned introduction of bond notes demonstrates that the Zanu government has run out of ideas to fix the regressing economy”. In a statement issued Wednesday, the International Monetary Fund said Zimbabwe’s economic difficulties have deepened aggravated by a devastating drought, tight liquidity conditions and negative inflation. “Given the outlook for the global economy, growth is projected to remain below levels needed to ensure sustainable development and poverty reduction”.
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The strong USA dollar has made Zimbabwe a high cost producing country, expensive destination for tourists and externalisation continued to put pressure on the country’s balance of payment position.
