Cash crisis a nightmare

Source: Cash crisis a nightmare — Zimra – DailyNews Live

Ndakaziva Majaka      21 April 2017

HARARE – The Zimbabwe Revenue Authority (Zimra) on Wednesday said the
current cash crisis is now a nightmare that is affecting the country’s
economic growth.

Zimra chairperson Willia Bonyongwe said there was need for all
stakeholders to come up with a solution to end the debilitating cash
crisis that has resulted in people queuing for days on end to withdraw
money from banks.

“Unfortunately, the liquidity situation worsened again during the first
quarter of 2017,” she said in a revenue performance update.

“Procurement of imported raw materials and capital equipment has become a
nightmare, and there are long foreign payment queues at the Reserve Bank
of Zimbabwe eating into the gains of SI 64 of 2016,” she added.

Bonyongwe further indicated that regional currencies continue to weaken
against a stronger United States dollar thus worsening Zimbabwe’s export
competitiveness.

“The responsibility to address the liquidity crisis does not lie with the
Reserve Bank of Zimbabwe alone. It is the duty of everyone to act
responsibly and in the national interest in how cash is handled for the
country to restore stability in this area,” she said.

This comes as the national tax collecting agency said local consumption of
petroleum products is tumbling with petrol and diesel imports going down.

“Petrol imports declined from 113,86 million litres in the first quarter
2016 to 99,72 million litres in the 2017 first quarter while diesel
imports declined from 190,14 million litres in first quarter 2016 to
180,93 million litres in first quarter 2017,” Bonyongwe said.

The Zimra boss also noted that the decline followed another slump in the
last quarter of 2016, after acute fuel shortages which rocked the country
during the festive season.

“The decline is partly due to the economic performance but also captures
significant smuggling and transit fraud,” she said.

Bonyongwe said the tax agency had made inroads in curbing transit fraud
through its Electronic Cargo Tracking System, which is currently still
being rolled out.

“However, smuggling through undesignated entry points is more problematic
and actually beyond Zimra’s capacity to curb on its own. It requires a
more concerted national effort and political will to eliminate that king
of smuggling,” she said.

Zimbabwe is presently battling fuel shortages due to erratic supply with
most pumps at local service stations dry while fuel companies are failing
to pay for the commodity.

Energy ministry secretary, Partson Mbiriri, recently said the country did
not have fuel availability problems, “but rather payment problems,” with
all suppliers demanding cash for fuel delivered, despite cash shortages
presently being experienced in Zimbabwe.

“I have explained the reasons for the shortage at the pump; you have the
product in our storage tanks right throughout the country.

“But in order to redeem that product, you need to pay for it. It is here
under bonded conditions…

“The product is in the country and we continue to import it, we continue
to have arrangements by some fuel companies bringing in the product and
allowing for that product to be sold using local currency, local
resources, local transfers…,” Mbiriri said.

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