Source: ‘Bond notes features still being designed’ – Sunday News October 2, 2016
Roberta Katunga, Senior Business Reporter
A FEW weeks before the expected launch of bond notes, the Reserve Bank of Zimbabwe is still designing and coming up with features that will appear on the notes.
Addressing concerns from the business community in Bulawayo on Friday, RBZ deputy director International Banking and Portfolio Management Mr Ernest Matiza said the features of the notes were still being designed and hence they could not start marketing the notes. However, they are expected to be in use by the end of the month.
He added that the bank could not have started aggressively marketing the new notes as the issue had been before the courts with opposition leader Dr Joice Mujuru launching a failed bid to have the bond notes declared “illegal”.
“Once an issue is before the courts, you are conflicted. We were waiting for the ruling on bond notes before vigilant marketing and now that it has been resolved we can focus on explaining what these notes are, their features and relation to the US dollar.
When we are now ready to issue out the notes, you will start seeing more of the adverts,” said Mr Matiza.
He said the aggressive marketing of the bond notes will increase once they are in circulation. Mr Matiza said bond notes were coming in to enhance productivity as an export incentive. He reiterated that the RBZ was not trying to introduce the Zimbabwean dollar through the back door as has been the assertion by opposition politicians.
“We are not shy as a bank to such an extent that we would try and smuggle a local currency into the market. Our main objective at the moment is to restore confidence in the multi-currency system as we understand through our economists, advisers and consultants that conditions are not yet conducive to introduce a local currency,” said Mr Matiza.
He said people should not adopt a negative attitude towards the introduction of bond notes as they will not be forced on consumers, adding it was not an issue of people not wanting the bond notes but an issue of trust. Mr Matiza said the RBZ had been getting a number of questions from Zimbabweans asking whether the central bank will adhere to the $200 million stated or choose to extend.
According to the RBZ, $6 billion worth of exports will be generated after the exhaustion of the $200 million export incentive scheme. The Government is set to release bond notes worth $75 million by the end of December in $2 and $5 denominations.
An independent board made up of different stakeholders will be set up to monitor issuance of the bond notes and ensure not more than $200 million worth of the notes is allowed into circulation. The new notes will be printed in Germany and backed by a $200m support facility provided by Afreximbank (Africa Export-Import Bank).
COMMENTS
An issue of trust? Not going to be forced to accept them? This is total chaos and who the hell do they think we, the people of Zimbabwe are? School children?
One feature they should include is a digital display of the denomination. The banks could then just electronically change the denomination, from, say, $10 to $100 to $10 000 etc on the same note. That way they will not need to throw the bond notes away and print new ones every few days. This would make the first notes printed more expensive, but will save money in the long run.
another feature could be a large TRASH bin — so that we know exactly where these bond notes belong
Bond notes might be the spark which will ignite the firestorm.
Likely, many won’t realize the problem with this worthless paper until retailers try to pay for imported goods with them, or folks try to purchase something across the border with them. Once those issues work their way through the supply chain (and that will happen quickly), there will be riots because workers will begin refusing to take them for pay, and retailers will reject them as payment for goods. (And that doesn’t even account for the coming government-created mega-inflation.) Perhaps the bond notes should be reserved for paying government fees/fines/penalties only… and all that worthless paper will end up back where it began.
HOKOYO FELLOW ZIMBABWEANS
These Zimbabwe bond notes or counterfeit US dollars will lose 90 per cent of their value within the first week of their release – of this I can guarantee – hold onto your US dollars under your bed or in your own pocket at all times comrades !
LETS WAIT AND SEE, NOBODY KNOWS