‘There is enough cash in the economy’ -says Chinamasa
Finance minister Patrick Chinamasa has insisted that there is “enough” cash in the economy and blamed queues at banks on the lack of public confidence and trust in the local financial sector.
Zimbabwe has struggled with serious cash shortages since April 2016 resulting in locals literally sleeping in bank queues with the government apparently unable to address the problem.
However, speaking at a business meeting in the eastern border city of Mutare last week, Chinamasa said what was in short supply is confidence, and not cash.
“There is no confidence in our economy. The main illness of our economy is lack of confidence and trust,” Chinamasa told the meeting.
“In Zimbabwe’s case, cash is there but not circulating. Why there is no circulation is that people don’t believe that if they put their money in the bank today they will get it when you want to use it.
“So, all the system is drained of all the money. The economy is about money circulating. Imagine all of us here, we have the same mentality.”
He said if the issue of confidence is addressed it will also help to solve issues like speculation and rumour mongering which he said is a by-product of lack of confidence.
Chinamasa said leaders should not disseminate information which triggers panic in the economy.
“As leaders we should know the implications of what we say in the public. We should not say things that trigger panic as this will reverse gains we have achieved in recent years,” he said.
Chinamasa assured the stakeholders that the issue of prices was being attended by industry minister Mike Bimha.
“We have taken a position which I supported as well that it would be catastrophic to impose price controls; it would reverse the gains we have achieved so far. “Our position is to engage with those in business so that we understand where they are coming from,” said the minister.
He said there was no basis whatsoever for fuel importers to have a three or four tier price system as they are being allocated foreign currency by the Reserve Bank of Zimbabwe (RBZ). Chinamasa said he was confident that the economy will grow up to 4, 5 percent this year up from 3, 7 percent last year.
“With the new political dispensation, I am very confident that the economy will take the true growth path trajectory.