Forex dealers begin to stew

HARARE - The hordes of illegal foreign currency traders who had made the streets of Harare their home are increasingly becoming a rare sight, as President Emmerson Mnangagwa’s abatement measures take effect.

As has accurately been reported by the Daily News over the past few weeks, Mnangagwa this week introduced temporary emergency policies to mitigate the country’s rampaging foreign currency black market.

The new laws prescribe a maximum 10-year custodial sentence for illegal foreign currency traders, with authorities empowered — through the Unexplained Wealth Orders Statute — to confiscate all ill-gotten wealth.

A survey by this publication revealed that as the law became operational on Monday, illegal foreign currency traders deserted their usual selling points.

However, the fears are that most of the illegal foreign currency traders have now started operating on their mobile phones, and through which they arrange to meet their customers at secret locations.

Two weeks ago, Mnangagwa warned that he would bring “grief” to all those who are involved in the illegal trade of foreign currency, as he tries to bring stability to the country’s wobbly economy which went into turmoil at the beginning of last month when the government unveiled a slew of unpopular measures.

“An unexplained wealth order is an order requiring the respondent to provide a statement setting out the nature and extent of the respondent’s interest in the property in respect of which the order is made and explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met).

“The High Court must be satisfied that there is reasonable cause to believe that the respondent holds property and the value of the property is greater than US$10 000 or its equivalent,” read part of the measures contained in the Money Laundering and Proceeds Crime Act and Exchange Control Act statutory instrument that became effective on Monday.

The new law gives authorities the power to freeze any property suspected to have been acquired illegally.

The new measures come as Zimbabwe remains in the grip of a huge economic crisis which has seen the country slipping back to frightening levels similar to the disastrous 2008 hyper-inflationary era.

The country has, consequently, been experiencing acute shortages of foreign currency, which in recent weeks triggered shocking price hikes, shortages of essential medical drugs and basic consumer goods.

At the same time, the government’s recent austerity measures, which are seen as the first steps towards reviving the country’s economy, did not find resonance with the majority of fearful Zimbabweans.

Comments (9)

This is just a futile attempt by Mnangwagwa because as long as the country is nor generating foreign currency and as long as the RBZ does not give companies forex to buy raw materials most of we do not have here in Zimbabwe.Until Zanu pf and its daft but greedy leaders realises that a government that fails in its obligation to provide basic needs for its people,they will always find a way to solve thier own problems,whether legally or illegally.They dont want peole to trade forex on the black market yet they are failing to give the same people forex through the banks to buy raw materials.People will just continue with their trade underground because thats their only way of survival that they have know,some of them since birth on account the unemployment rate has ballooned to very dangerous heights.

janana wa Bikaz madhogodhogo - 15 November 2018

90% of businesses need foreign input to trade. Where are they going to get the foreign currents from? The bliss will collapse the bond note.

toko - 15 November 2018

Good policies and good governence are the only ways to save this economy. Arresting forex dealers will not achieve anything. Still pharmacies are charging us USD. Where are we going to get the USD? Obvious from black market. Now its up to us to devise ways to meet the guys and exchange USD with worthless bonds.

Makumbinde - 15 November 2018

Go passport office every morning you will see these guys pretending as if they are selling airtime, ballpoint pens or passport covers yet they will selliing money . they haben,t varnished but they have changed there way of doing business, Yes law on illegal currency trading is well come what about the selling and drinking of beer in the streets mainly at bus terminuses like market square, forth street, copa cabana, etc. What are we doing about it. Innocent souls are being harassed by these drunkards, What is the gvt and council doing to safeguard those who do not drink, especially women and children.

Pakuru - 15 November 2018

zimbabwe is a multi currency economy.. all the currencies targetted in this hypocrisy are legal tender in zimbabwe .. so if i need rand and the other guy has the USD ..what s wrong, it s all fareness what other so called legal channel exists for such..?

alternative - 15 November 2018

The free market will always be with us comrades - remember that. Now tell me where can i exchange my bond notes for USD at 1 to 1 ?

ace mukadota - 18 November 2018

The same Junta is to blame for this forex blanket market. Elementary economics has an answer to that. Moreover bond notes has no value and its the height of foolishness to equate it to the green back. Cloning United States Dollar has caused more harm than good and now we hear 100US$ =350 BOND Notes. This law will continue to push the price upwards and trying to rig it like elections won't work this time

Eddy - 18 November 2018

well...this was communicated at the point of introduction in parliament by the very person whom they said is uneducated "Chinoz" saying,"will not this lead us back to 2008 where we saw prices of basic commodities rising?" What was the actual reason of introducing a $1bond, $2bond, $5bond when we already had the $1Us, $2Us and $5Us. Now we are being hurt by these drastically rising prices. Comeon guys Let us not destroy. let us build our Zimbabwe and stop the aiming at our interests as individual forgetting that we are leading others to hell.

Fatso - 19 November 2018

My issue is how does a Forex trader get new bricks of serialised bond notes when the banks are giving out 0-20$. There is a rot in the system that is bigger than the trader and arresting them is like just treating the symptoms and not the root cause which has perpetuated the rot in the country. Obviously people high up the food chain. Until those people are cut out from the system then as a nation we should brace ourselves for even greater problems. Mabricks emari arikubva kupi???

Kuda wekwa Vumabaranda - 19 November 2018

Post a comment

Readers are kindly requested to refrain from using abusive, vulgar, racist, tribalistic, sexist, discriminatory and hurtful language when posting their comments on the Daily News website.
Those who transgress this civilised etiquette will be barred from contributing to our online discussions.
- Editor

Your email address will not be shared.