Air­lines en­dorse bond notes us­age

Chronicle (Zimbabwe) - - Business Chronicle -

GLOBAL and re­gional air­lines ply­ing the Zim­babwe route are on board with re­spect to us­ing bond notes, a top air­lines of­fi­cial has said.

Chair­per­son of the Board of Air­lines Rep­re­sen­ta­tives and South African Air­ways coun­try man­ager Ms Win­nie Muchanuka said the In­ter­na­tional Air Trans­port As­so­ci­a­tion (IATA) had ac­cepted rep­re­sen­ta­tions made by the Re­serve Bank of Zim­babwe.

IATA’s key role is to ba­si­cally sup­port the global avi­a­tion in­dus­try with global stan­dards for air­line safety, se­cu­rity, ef­fi­ciency and sus­tain­abil­ity.

Said Ms Muchanyuka yes­ter­day: “From the air­lines’ per­spec­tive we have had re­cent en­gage­ments with the Re­serve Bank of Zim­babwe and rep­re­sen­ta­tives from IATA be­cause ob­vi­ously ques­tions have been raised from an IATA per­spec­tive as the body that rep­re­sents air­lines to say how is this go­ing to work be­cause the fun­da­men­tal thing for air­lines is the abil­ity to repa­tri­ate funds to their head of­fices.

“But we have re­ceived as­sur­ances from the Re­serve Bank that we should not worry about the repa­tri­a­tion of funds for for­eign air­lines to their head of­fices and that the Re­serve Bank will fa­cil­i­tate the process.

“So air­lines will be able to ac­cept bond notes but ob­vi­ously this is de­pen­dent upon the com­mit­ment of the Re­serve Bank to be able to fa­cil­i­tate the repa­tri­a­tions. If repa­tri­a­tions are hap­pen­ing then there is no need for us to worry about the bond notes.”

Bond notes are a fi­nan­cial in­stru­ment that was mooted by the cen­tral bank aimed at eas­ing liq­uid­ity chal­lenges, pre­vent il­le­gal ex­ter­nal­i­sa­tion of funds, and in­cen­tivise ex­porters to sell more of their prod­ucts out­side the coun­try to earn for­eign cur­rency.

In terms of the fa­cil­ity, the cen­tral bank will award ex­porters a bonus of be­tween two and five per­cent of the value of to­tal ex­port re­ceipts in bond notes, which will be cred­ited to the ex­porters’ lo­cal bank ac­counts.

The bond note fa­cil­ity has also been ex­tended to re­ceivers of in­ter­na­tional re­mit­tances.

Zim­babwe is cur­rently us­ing a bas­ket of mul­ti­ple cur­ren­cies un­der­pinned by the United States dol­lar. The bas­ket also in­cludes the South Africa rand, the euro, Ja­panese yen, Aus­tralian dol­lar, Chi­nese yuan, Botswana pula and In­dian ru­pee.

Mean­while, the Con­fed­er­a­tion of Zim­babwe In­dus­tries (CZI) and the Con­fed­er­a­tion of Zim­babwe Re­tail­ers (CZR) have put their weight be­hind in­tro­duc­tion of the bond notes. — BH24.

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