Dr Mangudya
Business Reporters
Reserve Bank of Zimbabwe Governor Dr John Mangudya says the central bank has enough bond coins to cater for increased demand due to the cross-rating of rand coins.
This comes as the Passengers Association of Zimbabwe said it has received a number of complaints from its members regarding what appears to be an increase in fares
PAZ said commuter omnibus operators are charging fares ranging from 5 rand, 6 rand to 7 rands per local trip in Harare.
Dr Mangudya said that the cross rating of the rand was not unusual given that the rand has been falling against major currencies especially the United States dollar.
“What has been happening with the rand coins is only natural because the value of the rand has been falling therefore businesses do not want to incur exchange rate loses.
“At the same time no one also wants to incur exchange rate losses so it’s no-one’s fault really,” he said.
On suggestions from some members of the public that he intervenes and fixes the exchange rate, which should be used to exchange the rand coins, Dr Mangudya said he has no such powers.
“I cannot do that because this is not our currency and even if I had the powers to do so I would not do it because I would be creating conditions for arbitrage,” he said.
The bond coins are part of the $50 million facility that the RBZ arranged for the purpose of providing the coins with intrinsic value. They are in denominations of 1c, 5c, 10c, 25c and 50c.
The coins were introduced as a way of mitigating shortages of coins in the economy, which had contributed to the overpricing of commodities and had forced consumers to accept things such as sweets as part of their change.
Since their introduction the coins have assisted in the restoration of proper pricing models and the alleviation of problems associated with lack of change, issuance of change vouchers and change in the form of unwanted goods.
PAZ urged fairness from commuter omnibus operators. “
“We ask for fairness on the part of commuter operators and their crews and we applaud those that have maintained their fares at 5 rand,” PAZ said.
“In fact people have a misunderstanding on the real exchange rate between the rand and dollar.
“It should be appreciated that five rand is not equivalent to fifty cents. On the other hand, the fact that bond coins are equivalent to the US cents makes them more convenient for any transaction without having to use any exchange rates.
“Therefore, we encourage the use of bond coins. The RBZ has indicated that bond coins are available at local banks and Easy Link Money Transfer agents, through existing branch networks,” PAZ said in a statement.