Zimbabwe Should Immediately Re-dollarise – Biti

(FILES) In this file photo taken on June 01, 2018 MDC Alliance Spokesperson Tendai Biti speaks during a press conference during which he announced that Zimbabwe's opposition parties are calling for electoral reforms ahead of the July 30 general elections and that there will be street demonstrations in the capital Harare on June 5. Senior Zimbabwean opposition figure Tendai Biti was arrested as he tried to flee to neighbouring Zambia to seek asylum, his lawyer said on August 8, 2018. Biti allegedly faces charges for inciting violence over the disputed result of last week's elections. / AFP PHOTO / Jekesai NJIKIZANA
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Former Finance Minister, Tendai Biti, says the government should urgently implement measures to save the economy after the value on the local currency to the US dollar has nosedived on the parallel market.

While officially the exchange rate is at 1:25, on the parallel market it has gone beyond 1:60.

Biti says the government, should, among other things, immediately dollarise, scrap export surrender requirements, and revert back to cash budgeting and fiscal consolidation. Said Biti:

With the US$ now trading above 65 on the parallel market, it is time the regime accepted the failure beyond any shadow of a doubt of its monetary and exchange rate policies.

We have constantly argued that you can rig everything else but not the economy. An urgent reset is required. The regime must

  1. Immediately dollarise through the repeal of Finance Act No 2 of 2019
  2. Scrap export surrender requirements
  3. Revert back to cash budgeting and fiscal consolidation
  4. Deal with corruption urgently particularly breaking the Sakunda/Trafigura /Command Agriculture axis.
  5. Provide an Urgent Fiscal Plan with international backing.
  6. Normalise and demobilize infrastructure of repression
  7. More importantly, there must be an urgent political solution.

The crises of legitimacy need resolution as a matter of urgency. The regime must ship out to allow.

On Wednesday, Reserve Bank of Zimbabwe governor John Mangudya said that at a time when Zimbabwe has been affected by the coronavirus pandemic, it has been left out of relief loan funds for the pandemic because it owed the World Bank and African Development Bank.

This, according to the central bank chief, means that Zimbabwe is now like a stepchild or orphan as it is considered high risk.