Home » Industry » Govt to Adopt Friendly Approach On Bond Coins

Government plans to adopt a market-friendly approach in enforcing the acceptance of the bond coins in the local market especially by commuter omnibus operators who have been on the forefront of resistance, a Cabinet Minister said.

There have been calls for the Reserve Bank of Zimbabwe to do more awareness campaigns on the newly introduced bond coins following apparent resistance by consumers and transport operators.

Speaking before Parliament on Wednesday, Finance and Economic Development Minister Patrick Chinamasa said the market lost confidence during the hyperinflation era and there was need for Government to take a sober approach in addressing the market resistance on bond coins.

“Some of the challenges we are facing are associated with lack of confidence, perceptions and we are reluctant to use the law to force people to accept the coins.

“Thus, the measures we are taking include adopting a market-friendly approach,” said Minister Chinamasa.

He said Government has had endless meetings with the associations responsible for commuter bus operators and retailers.

“I want to say there is now cooperation on the part of the major consumers and users of change, especially the wholesalers and retailers. There is now very good cooperation.

“We are also receiving good cooperation from the association responsible for commuter bus operators,” said Minister Chinamasa.

He said local banks started issuing change in bond coins whose value is equivalent to the United States cents on 18 December, 2014.

The RBZ met with all critical stakeholders that include local banks, the Consumer Council of Zimbabwe, Retailers Association of Zimbabwe, among others, on the issue and all the players are in agreement on the need for coins for change.

Minister Chinamasa, however, defended why the mint in Bulawayo was not used to produce the coins. He said Government took note of the concerns around using existing local capacity and this was a way of building confidence around the bond coins and therefore it was critical to have them minted elsewhere.

“Furthermore, you are aware that the mint in Bulawayo has not been operational for some time and it would have required more resources to mint them locally.

“The mint in Bulawayo currently has no capacity to produce the high security features that are needed to be put on the bond coins. It was security that got us to mint these coins outside the country,” said Minister Chinamasa.

He said there are certain security features and of course the Reserve Bank will elaborate through their education programme and campaign.

The extraordinary hyper-inflation levels ultimately forced the Zimbabwe dollar out of circulation in February 2009 and until today experience is still fresh in people’s minds and hence Government wants to accelerate efforts to instill confidence once again in a market that has become informal.

The business terrain has also changed where business is no longer in the formal sector neither is money circulating in abundance in the formal sector. In other words, formalising the acceptance of the bond coins in a highly informal market is proving difficult.

Source : The Herald