Public outcry as RBZ increases cash withdrawal limits

 

In a statement yesterday the central bank said the upward review of

withdrawal limits followed the introduction of Z$100 000, Z$500 000 and Z$1 million notes that were released on Wednesday. The central bank last reviewed withdrawal limits on October 10 from Z$20 000 to Z$50 000 when the Z$50 000 note came into circulation – a move which did little to ease the financial burden of Zimbabweans as the local currency continued to lose all value.

 

Withdrawal limits for companies had stayed at Z$10 000 per day, apparently as a way of encouraging companies to use alternative non-cash means of payment such as cheques and various forms of plastic. But the unreasonable limit, coupled with the RBZ’s decision to suspend the Real Time Gross Settlement system (RTGS), has instead seen many business close their doors, unable to pay their bills or their staff.

 

Former Harare MDC MP, Trudy Stevenson explained to Newsreel on Wednesday that the system has completely collapsed. Stevenson returned to Zimbabwe over the weekend after a few weeks away and said while she had expected the dollar to have gone down a bit, she added she was shocked by how valueless the Zimbabwe dollar has become. Stevenson explained that there is a daily rush to withdraw and exchange the dollars for American currency, saying the local currency has been totally dollarised.

 

People are also being caught out by exchanging at the bank, Stevenson said. You would be mad to exchange at the bank because the street value is often 100 times more than the official rate.

 

The Zimbabwe Congress of Trade Unions (ZCTU) on Wednesday lashed out at what it has called the current wave of dollarisation or Americanisation of the Zimbabwean economy by the authorities, at a time when most workers in Zimbabwe are earning their wages in Zimbabwean dollars. It comes as increasing numbers of local shops have stopped accepting the valueless Zimbabwe dollar, choosing out of financial desperation to trade in stable foreign exchange.

 

The ZCTU questioned whether the spreading acceptance of American dollars was another form of colonialism…despite their (the government’s) vilification of whites and colonialism. The Union has demanded that all workers be paid in American dollars if they want the use of the American dollar in all payments to continue.

 

The Union on Wednesday also said it was disgusted with the central bank’s decision to again increase the withdrawal limits despite calls from labour, including different sectors, exhorting the RBZ to remove the cap on cash withdrawals.

 

The ZCTU wrote letters to the RBZ in July and September about removing the withdrawal limit and even met a Reserve Bank of Zimbabwe official to express its concerns that the limits were far below what an ordinary family requires for daily expenditure. The ZCTU even threatened mass action if the RBZ did not address the worsening financial crisis, but in September called off the protests after moves by the central bank to resolve the issue.

 

But the ZCTU has since renewed its threat, saying in a statement released Wednesday that it is demanding that the RBZ remove the cap on cash withdrawal with immediate effect, and failure to do so means action is in the offing.