Rand still going strong

BY ZAKEUS CHIBAYA MUSINA - The South African Rand is still going strong against the ailing Zimbabwe dollar on black market despite many Zimbabweans returning home for the festive season and flooding the market with Rands. An informal survey by The Zimbabwean revealed that the currency is t

rading at R1 to $13 000-$15 000 in border town of Beitbridge and there are signs that it will be even stronger in January as people return to work in South Africa.

The Reserve Bank of Zimbabwe’s flexible foreign exchange rate which was introduced recently fixes the Rand at $9 000 to one. But this rate is clearly unrealistic. .

Reports from Roadport in Harare, ‘World Bank’ in Bulawayo and Wimpy in Masvingo reflect that the Rand is trading at $14 000- $16 000. And it is likely to shoot up early in the new year as many people will be hunting for hard currency.

More than four million Zimbabweans in the Diaspora have shunned RBZ CEO Gideon Gono’s Homelink initiative, which sought to encourage them to send money home via the central bank.

As they use the black market link to send money home for the festive season, more Rands will coming into the market and are expected to stabilise the dollar for at least three months.

“It’s surprising. We were expecting the Zim dollar to gain during the Christmas period, but it seems it will drop. People are clinging to their Rand and they are not willing to exchange to the dollar,” said Mhlaba Hlungwani, a foreign exchange dealer based in Beitbridge.

Black market foreign exchange brokers in Beitbridge and at Park Station in Johannesburg attributed the stronger Rand to the fact that many Zimbabweans are buying basic commodities in South Africa to send home – rather than sending money. Basic commodities are in short supply in the country or they are sold at a black market rate which is exorbitant and most people prefer to buy their goods in South Africa..

Esther Mlambo, who trades in Lutumba about 20km along the Beitbridge road said: “Even border jumpers who usually frequent the black market during the festive season are nowhere to be seen. They are just changing small amounts to cover their bus fare and the Rand is likely to trade at $20 000 early next year as more people will be heading for South Africa to look for greener pastures.”

11-january-2006
Zimbabwe Vigil Diary - 10th December 2005

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