The Reserve Bank of Zimbabwe say that they are encouraged by the de-dollarisation process that has been taking place in the country with the use of the local currency continuing to go up, reaching a total amount of ZW$459.6 billion from 189 million transactions for the full year 2019.
This follows the gazetted Statutory Instruments 33 and 142 of 2019 which provided the de-dollarisation framework for the country to trade exclusively in local currency (mono-currency).
Presenting the 2020 Monetary Policy Statement in the capital today, RBZ Governor John Mangudya said the foreign currency deposits as a proportion of money supply went down to 37% by 31 December 2019.
“The Bank believes that the macroeconomic signals that include fiscal and monetary discipline, prospects of positive economic growth and lower inflation are improving to support a gradual de-dollarisation process within a timeframe of 5 years. This is in line with other countries’ experiences on de-dollarisation.
“The foreign currency deposits as a proportion of money supply went down to 37% by 31 December 2019, whilst foreign currency-denominated loans in the banking sector stood at 22% of total banks’ loans and advances as at 31 December 2019.
“The use of the local currency for transacting purposes has also continued to go up, reaching a total amount of ZW$459.6 billion from 189 million transactions for the full year 2019,” he said.
Mangudya added that “These measurements of the proportion of the use of the local currency in the economy show that the country is on the right trajectory to de-dollarisation.
“The Bank shall, therefore, continue to provide incentives to promote and defend the use of the local currency within the economy in order to support the de-dollarisation process,” he said.