Chinamasa explains cash shortages

HARARE - Finance minister Patrick Chinamasa has said shortages of cash reflect the mismatch of US dollars in bank accounts and physical cash in the economy.

Physical cash is comprised of US dollars, bond notes and other currencies in circulation in the country. 

“This cash shortage reflects the negative perennial trade imbalance wherein our imports are more than exports by exports around $3 billion on a yearly basis.  So, we need to target our policies to reduce our trade balance,” Chinamasa told the National Assembly in a ministerial statement last Thursday.

He said the shortage of cash also reflects the poor circulation of money in the economy due to lack of confidence, discipline as well as rent seeking behaviour.

“Mr. Speaker, Sir, there is $1 billion of physical cash in circulation made up of $180 million in bond notes, $28 million in bond coins and $800 million.  We consider this to be sufficient if it was circulating efficiently.

“The $1 billion translates to around 15 percent of deposits which is international best practice in normal economies.”

Comments (8)

hapana chaunoziva. mhuno dzinenge matanga emarize nyarara!!!

josphat mugadzaweta - 3 October 2017

Minister, do not forget to tell us that the cash shortages are also a direct result of some many individuals who have an appetite for foreign travels, who prefer bread from outside Zimbabwe rather than our own Bakers Inn

Collin - 3 October 2017

How many times do Chinamasa, Mangudya and their apponting authority meet per week to discuss this (and other) life-threatening national diseases? It appears like we have jokers in "power".

Sagitarr - 3 October 2017

This guy is just a liar, we all know the introduction of bond notes was simply to steal the public's US$ we know that, he can try to come up with all these economics terms and all that but truth is this was not by accident but pure design. Where in the world has such a fiat currency worked? In fact it's not even a fiat currency it's just a piece of worthless paper that they paid for with real US$ to be printed kkkk o.m.g this is crazy...People of Zim are very soft, we all are, how can you bank US$ and when you withdraw you get bond and that's fine? This guy must give you your US$ back, this is daylight robbery, he must be jailed for stealing the citizens' money.

misty - 3 October 2017

kkkkkkkkkkkkkkkkkk chinamasa dofo rakadzidza kkkkkkkk dofo kkkkkk dofooooooooo uriziii dofofofofo kana dofo rinoona kuti uridofo kkkkkkkkkk

g40 - 3 October 2017

I think minister you need to work hard to stop the issue of cash crisis. where did the cash dealers found the cash. it is my thinking that these money changers are working hand in glove with the banks coz there are always having brand new bond notes and brand new US dollars and my question is where do these guys get their money from. Minister must figure that out for the general popularity of Zimbabwe. The mass are suffering

HON magwidi - 4 October 2017

Chinamasa, stop stating the obvious. We know that already. #1 Go deeper and explain why imports are greater than exports (we killed our economy, you allow 1st family to go on world shopping trips with huge entourages on taxpayer dollars, they externalize much needed cash - rings, Rolls Royces, mansions). #2 Go on to tell us how you intend to resolve it.

Zuze - 4 October 2017

IF a big insurance company had the guts to invest pension contributions of zimbabweans in non productive investment schemes such as WESTGATE and the ultimate EASTGATE who is that economist who recomended those funds to be dropped in the hyper drain zone and surely if heaven exists all old mutual top executives could be heading for hell for not practising mercy...Even the young articles trainee accountants who assisted in unknowingly authorising those investments shall be judged for we are suffering even our fathers s pensions were zero valued after OLD MUTUAL pulled out and the ensuing REINSUARANCE whatever tomorrow somebody shall explain on earth or in heaven otherwise the silent voice in streets could call for an african INTERNATIONAL CRIMINAL CRT AS well as any International Criminal Economic and Financial Justice Court.....Economic Speculators were rife in this result but ALMIGHTY shall remember Zimbabwe.

BRIGHT CHAKO - 5 October 2017

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