Bond notes fea­tures to stay un­der wraps

Chronicle (Zimbabwe) - - Business Chronicle - Oliver Kazunga

THE Re­serve Bank of Zim­babwe (RBZ) says it will not dis­close the fea­tures of the bond notes un­til they of­fi­cially start cir­cu­lat­ing in the mar­ket next week. RBZ Gover­nor Dr John Man­gudya said yes­ter­day that due to se­cu­rity rea­sons the apex bank would not rush to ad­ver­tise the fea­tures of the new notes be­fore their launch. Bond notes will be re­leased into the mar­ket next week as part of an ex­port ini­tia­tive by the Govern­ment to pro­mote do­mes­tic pro­duc­tion and ex­ports. The ini­tia­tive is meant to in­crease for­eign ex­change earn­ings for the coun­try as well as help curb e x t e r n a l i s a t i on of funds while im­prov­ing liq­uid­ity. Un­der the fa­cil­ity ex­porters will be awarded an in­cen­tive of up to five per­cent of the to­tal ex­port value.

Said Dr Man­gudya: “We will only ad­ver­tise the fea­tures of the bond notes si­mul­ta­ne­ously with their re­lease and this is for se­cu­rity rea­sons”.

He added: “For ex­am­ple, if we are to re­veal be­fore their re­lease that one of their fea­tures is brown in colour that threat­ens the se­cu­rity, which we are sup­posed to give to the notes be­fore they start cir­cu­lat­ing.”

Pres­i­dent Mu­gabe has gazetted Statu­tory In­stru­ment 133 of 2016, which pro­vides the le­gal frame­work for the in­tro­duc­tion of bond notes as le­gal ten­der in Zim­babwe.

As such the Amend­ment of the RBZ Act em­pow­ers the cen­tral bank to is­sue out bond notes us­ing its pre­ferred de­sign, form and ma­te­rial.

The bond notes are be­ing in­tro­duced un­der a $200 mil­lion guar­an­teed Africa Ex­port Im­port Bank (Afrexim-Bank) fa­cil­ity that Govern­ment se­cured for the scheme.

Dr Man­gudya has hinted that bond notes worth $75 mil­lion of the $200 mil­lion Afrexim Bank would be re­leased by the end of De­cem­ber in $2 and $5 de­nom­i­na­tions

He has also pointed out that the bond notes were com­ing in to en­hance pro­duc­tiv­ity as an ex­port in­cen­tive.

The mone­tary author­ity is on record as say­ing the in­tro­duc­tion of bond notes is not a ploy to try and re-in­tro­duce the Zim­bab­wean dol­lar which was sus­pended in 2009 when in­fla­tion rose to un­prece­dented lev­els.

RBZ has urged the public not to adopt a neg­a­tive at­ti­tude to­wards the in­tro­duc­tion of bond notes as they will not be forced on con­sumers, high­light­ing it was not an is­sue of peo­ple not want­ing the bond notes but an is­sue of trust. It is be­lieved that $6 bil­lion worth of ex­ports would be gen­er­ated af­ter the ex­haus­tion of the $200 mil­lion ex­port in­cen­tive scheme. — @ okazunga sav­ings re­tire your re­spec­tive debts. The above is eas­ier said than done. It is a ded­i­cated process. A dis­ci­plined ap­proach that in­volves los­ing your pride, doc­u­ment­ing debt, sav­ings, earn­ing ex­tra in­comes, set­tling your debt obli­ga­tions timely among many other per­sonal ini­tia­tives. It’s about you do what needs to be done as no-one but your self can eman­ci­pate your­self.

No debt /debt free No one is free like a hu­man be­ing who is with­out debt. There is some­thing quite lib­er­at­ing about not be­ing in debt. As we know debt is bondage and as such free­ing your­self from these shack­les is of para­mount im­por­tance to achieve fi­nan­cial free­dom. You have to be smart about debt man­age­ment at all times.

As we ap­proach the fes­tive sea­son we know there is al­ways un­planned ex­pen­di­tures we do warn that there could be se­ri­ous con­se­quences af­ter the hol­i­days. Spend wisely. Re­mem­ber your next in­come could be in Fe­bru­ary.

CAU­TION: Bor­row­ing more than one can af­ford to re­pay can cause se­ri­ous fi­nan­cial dif­fi­cul­ties.


Mor­ris Mpala is the man­ag­ing di­rec­tor of MoB Cap­i­tal lim­ited, a Bu­l­awayo head­quar­tered mi­cro­fi­nance in­sti­tu­tion with foot­print across the coun­try.

Dr John Man­gudya

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