RBZ importing $3m bond coins

HARARE - The Reserve Bank of Zimbabwe (RBZ) has contracted a South African company to manufacture six million 50 cent bond coins — equivalent to $3 million — that could be injected into circulation soon.

According to a leaked invoice that has set social media ablaze, the firm — South African Mint Company (SAMC) — is minting the coins at a cost of 5, 2 million rand.

SAMC is a wholly-owned subsidiary of the South African Reserve Bank.

With over 100 years experience in supplying coins to Africa and the world, SAMC prides itself as the leading African mint.

“Our experience in producing high quality currency and commemorative coins enables us to provide a comprehensive service to our customers,” it says on its official website.

“Working in close collaboration with our customers, we provide durable monetary exchange products that capture and preserve the heritage and pride of a nation.”

The move comes as Zimbabwe’s long-running cash crisis is deepening, with desperate banks resorting to disbursing withdrawals to depositors in coins.

Currently, there are in excess of $170 million worth of bond notes in circulation.

The bond notes are a form of surrogate currency to the United States dollar, introduced in November last year as a desperate measure to curb a crippling cash crisis.

RBZ governor, John Mangudya, announced recently that the apex bank would inject $300 million more bond notes into the system, amid calls for more coins by business leaders.

If the leaked invoice is anything to go by, the central bank seems to have responded positively to the calls.

Signed by SAMC’s chief financial officer, Gerda Janse van Vuuren, the invoice reads in part: “Denomination: 50 cent bond coins, number of coins: 6 048 000, number of drums: 126, cost in rand per 1000 pieces: 849.09, total cost in rand: 5 135 296.32. Coins manufactured in South Africa. Country of origin South Africa”.

It was addressed to RBZ banking operations deputy director, a Professor Kuveya.

Reached for comment, Kuveya said he was in a meeting before hanging up and going on to cut all subsequent calls from the Daily News.

Officials in the RBZ suspect that the invoice was leaked by freight forwarders.

Currently, there are $2 and $5 denominations of bond notes circulating alongside the bond coins.

In their calls for more coins, industry lobby group, the Confederation of Zimbabwe Industries (CZI) said, for now, the $3 million bond coins would make transacting easier, but will not have much effect in addressing the economic woes bedevilling the country.

CZI has previously urged the RBZ to release the additional $300 million, not in notes, but in coins as a way of countering the black market.

“The coins will aid the transacting public, because there are instances where we are falling to buy essentials.

“I believe it will help lower price traders who are losing out on demand because of unavailability of small denominations. But on the outlook it will not have much of an effect,” said CZI president Sifelani Jabangwe.

Meanwhile, opposition MDC shadow Finance minister, Tapiwa Mashakada, said the lack of confidence in the banking sector, which has resulted in people avoiding depositing their money in banks, would persists.

“This ducking and diving will never take Zimbabwe anywhere, that’s why we had suggested for the adoption of the rand seeing that South Africa is Zimbabwe's largest trade partner, accounting for about 60 percent of our trade.

“The banks tried in the past to issue coins but that caused mayhem  as customers took time to access those coins because they don’t have counting machines.

“The demand for cash is outstripping supply by a big margin and we are just going in circles.”

Former Finance minister Tendai Biti felt government was hiding behind a finger.

“All the work we did (during the inclusive government) they are undoing, once a pig always a pig. Mamvemve akarehwa naThomas Mapfumo.

“What we need is investment in production, anything other than that is nonsense,” he said.

Mamvemve implies patch-work.

Comments (1)

John "Bond" Mangudya is a genius. His coins made in S Africa cost Rand 5. 2 million and are now worth US dollars 3 million. This man is so clever - and zimbabweans are being sold a worthless coin for 50 us cents !!?

ace mukadota - 23 September 2017

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