‘FOREIGN PAYMENTS IMPROVE’
THE Confederation of Zimbabwe Industries (CZI) says the processing of outgoing payments for the procurement of productive imports and raw materials has “slightly” stabilised on the back of tobacco sales’ receipts.
In February, the Reserve Bank of Zimbabwe announced that it had arranged a nostro stabilisation facility amounting to $70 million that has been disbursed to banks.
In an interview, Confederation of Zimbabwe Industries (CZI) vice president Mr Sifelani Jabangwe said the $70 million nostro stabilisation facility had managed to attend to funded accounts.
“The RBZ made an undertaking to clear funded accounts and it is those accounts that were attended to by the $70 million nostro facility.
“Due to improved liquidity probably as a result of the opening of the tobacco selling season, delays in the processing of outgoing payments have slightly eased than at the time before the start of the tobacco selling season,” said Mr Jabangwe.
“As CZI, we are not hearing any noise over delays in the processing of foreign payments. Of course the challenge is still there, companies are still queuing for outgoing payment processing but the situation is much better otherwise at the end of the tobacco selling season it might resurface.”
Statistics from the Tobacco Industry and Marketing Board show that Zimbabwe has realised $307 million from tobacco sales receipts compared to $240 million generated during the same period last year. This year’s tobacco selling season opened mid-March.
Mr Jabangwe said the panacea to delays in the processing of outgoing payments largely lies in increasing exports to generate more revenue as well as reducing the importation of goods that can be manufactured locally.
As part of efforts to regulate imports entering into the country, the Government last year promulgated Statutory Instrument 64 of 2016, which removes several goods from the Open General Import Licence (OGIL). Over 40 products were listed on the OGIL. RBZ Governor Dr John Mangudya is on record as saying the decline in foreign payments was largely due to the enhanced management of foreign currency being implemented through the import priority list guideline to authorised dealers.
The RBZ introduced preservation of foreign exchange in nostro accounts by enforcing market and institutional discipline and domesticating the settlement of local card transactions on international card switches.
The measure was necessitated by the need to ensure that nostro accounts are used for foreign payments and that domestic transactions are settled locally through platforms such as Real Time Gross Settlements (RTGS), ZimSwitch, VISA, Mastercard, local mobile banking and/or cash and bond notes.
The use of nostro accounts to settle domestic transactions put unnecessary pressure on the country’s foreign exchange reserves that should ideally be used for international or offshore payments.