via Mzembi: Foolish for Zim to reject Rand – NewZimbabwe 28/12/2015
TOURISM and Hospitality industry minister Walter Mzembi says Zimbabwe is losing millions of dollars in revenue by abandoning the depreciating South African rand.
The South African rand has had a miserable 2015, sliding more than 25 percent against the US greenback.
A major commodities exporter, South Africa has been hit by the decline in the prices of coal, gold and iron on the back of falling Chinese demand and oversupply.
The ailing SA currency is now being rejected by the Zimbabwean shops.
The development mirrors rejection of the Zimbabwe dollar which government eventually dumped at the end of 2008 when it had become virtually worthless.
The local sector has also started rejecting the rand.
But addressing journalists in Harare recently, minister Mzembi said it was unwise for Zimbabwe – a country which does not have its own currency – to shun the SA rand.
He said government should rather take advantage of the depreciating SA currency by offering incentives on rand transactions to boost the country’s ailing economy.
Mzembi said his sector is willing to accept the rand and attract more tourists from South Africa who have stopped visiting Zimbabwe because of the rejection of their currency by the local market.
“We will talk to them (South Africa) and say your greatest prospect for hedging this currency which is depreciating daily, is to make Zimbabwe productive …
“… and, to the extent that we are 70% of your market in terms of exports, we are urging you now to start accepting your own currency, so you make us strong and we make your currency strong,” he said.