Source: ‘Bond notes law imminent’ | The Herald October 7, 2016
Innocent Ruwende Senior Reporter
Government is in the process of crafting a law to support the introduction of bond notes as the country needs a mode of transaction it can control, Vice President Emmerson Mnangagwa has said. The statement comes barely two weeks after the Constitutional Court dismissed, with costs, an application challenging the introduction of bond notes by Zimbabwe People First leader Dr Joice Mujuru as premature and speculative for seeking to challenge bond notes which are not even in circulation
Speaking at a luncheon to mark the official opening of the Fourth Session of the Eighth Parliament of Zimbabwe in Harare yesterday, VP Mnangagwa said the financial services sector is constrained because the legal tender of the country is anchored on foreign currencies, hence Zimbabweans should embrace bond notes.
“Let me assure you that it is not a dream. It is going to be reality. We are going to live with it. Those who can easily realise that reality should begin to accept that the bond notes will be with us. We are in the middle of crafting legislation to introduce the bond notes.
“The current financial service sector in the country is constrained by the fact that currently the legal tender of the country is anchored on currencies that we have no control over. We need a mode of transaction, which we can control in the country on the basis of security provided by the Exim Bank $200 million,” he said.
He said assets or resources created in the country cannot be matched with the circulation of money supply in the country. As such, the introduction of the bond notes will see the country being able to have a currency that circulates within its jurisdiction, which will be used to do internal transactions.
“The US dollar or the pound, which we use kutengesa madora (edible caterpillar) is an important international currency in other jurisdictions, but here we use it for anything,” he said.
Vice President Mnangagwa called for unity, peace and stability for the purpose of the economic growth. He said Government has also crafted a programme to make sure that in the next three or four seasons, there would be food security.
“We need to say bye to the importation of grain into this country. Under that programme, I would want to state here publicly that we have been pleasantly surprised by the cooperation we received from the private sector in support of the Command Agriculture Programme.
“We are grateful, and also the support we have received from the farmers countrywide. There has been over-subscription to the programmes in both matter of hectares and farmers coming forward to take part in the programme we are grateful,” he said.
Vice President Phelekezela Mphoko urged Zimbabweans to pray for normal rains. “I appeal, on behalf of President Mugabe and VP Mnangagwa! All religious leaders and traditional leaders, let us pray for normal rains. There is a threat that there will be floods, but floods are a curse. Please let us pray for normal rains,” he said.
Local Government Public Works and National Housing Minister Saviour Kasukuwere said, the current situation in local governance was still fraught with socio-economic challenges that require concerted efforts from Government.
“Conscious of the fact that, the aforementioned challenges should not be used as an excuse for short-changing ratepayers by allowing the delivery of services and infrastructure to deteriorate to unprecedented levels witnessed to date.
“Gone are the days when we used to run local authorities as charitable organisations. Instead, local authorities should be run like other conventional business entities, with clear objectives of high quality service delivery on a sustainable basis,” he said.
COMMENTS
Riots and chaos are also imminent. Head-less chickens living in cloud-cuckoo land. Be afraid, Zimbabweans, be very afraid.
Those who can realise the reality that you can shove your bond notes up your ass will be with you. Why not export your edible caterpillars and get 5% incentive yourself. A brain transplant in Singapore will cost you only a few billion bond notes – take the opportunity, you desperately need it.
I think the law of economics will show how desperately stupid this plan is.
So the zimdollar is coming back at the barrel of a gun (so called law) this is because they cannot raise taxes sufficient to meet their greedy appetites. So the penalty will be inflation which will be blamed on greedy shopkeepers. They will then implement price controls which will mean empty supermarkets. In short, this is a very short term strategy because it will not work. What will happen is that they will wait for Mugabe to die, then Mnangagwa will talk about Zim
being open for business, a new dawn, a different paradigm etc etc. I don’t think it will wash because they have proved time and again they cannot be trusted and Gukurahundi will haunt them. In the modern age, western society will not stand for doing business with mass murderers.
Someone once said that if socialists understood economics then they would not be socialists.
This so called vp talks as if the Zimbabwean people are responsible for the creation of bond notes . Just like the demise of our currency , we are now witnessing the demise of the USdollar. Something unprecedented in the whole wide world. This vp must talk about how did we get to this stage and how did we not do anything to fix it instead of making lame excuses about nothing. You are living it large while others suffer. When last did you walk in town or any other for that matter. Are you blind or simply retarded to not notice anything around you. You Ma vp wake up and talk sense not complete rubbish like your useless boss .
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 !
The us dollar will also lose 90percent of its value inside Zimbabwe in official channels as it is tied to the bond note. What will happen is that there will be an unofficial market determined by supply and demand for usd and a parallel exchange rate. The usd will be purchased for cross border shopping trips. To shop in zim you can sell your usd for bonds at say 10 to 1 (to begin with) and the shops will be forced to accept bonds as it’s official currency. No one in their right mind is going to use usd to shop when you can exchange at 10 to 1. So the bond note will be subject to inflation notwithstanding the official 1 to 1 exchange rate. The rate of inflation will be proportional to the amount of bonds they print (watch out for Christmas bonuses)
‘as the country needs a mode of transaction it can control’ – Mnangagwa.
Never a truer word spoken. Control = use to steal.
Jono Austin above is spot on: the Bond notes will rapidly be traded at a discount to the real thing and even the few US $ in circulation now will disappear. Within days or weeks the Bond notes will be worthless.
The Zim government knows all of this. That is why the introduction date keeps getting put off. They are desperate for Mugabe to die. As a distraction.