Innocent Mujeri
Eighteen business entities are facing the wrath of the Reserve Bank of Zimbabwe (RBZ) for using foreign currency obtained from the auction trading system for purposes other than that specified in the application of the foreign currency.
In a statement today, the RBZ Governor Dr John Mangudya, said the Bank’s Financial Intelligence Unit (FIU) and the Bank’s Exchange Control Division had unearthed companies that were abusing the foreign exchange auction system.
“Accordingly, after investigations, the FIU and the Bank’s Exchange Control Division, entities listed hereunder which were abusing the foreign exchange auction system shall be dealt with in accordance with Statutory Instrument 127 of 2021 (SI 127),” said Dr Mangudya.
The country’s biggest maize meal producer, Natfoods was among the companies that are to be penalized by the RBZ. Other companies to face the full wrath of S1 127 are Georgia Petroleum, Africa Steel, Tettola Investments, Westville Investments, Flicknik Enterprises, Duo Valley Commodity Brokers and Fairclot Investments.
Other entities to be penalized are GlenuLas Trading, Natural Stone Export Company, Nuvert Trading, Phirebrook Investments, Classic Energy and Clorex Energy.
Explorechem, Mutare Mart and Exchange, Souzrce Fuels and Kimya Investments completes the list of auction system abusers.
The RBZ said that going forward and in line with the recommendations from the business community on the need to continue to enhance stability in the economy, its efforts to foster compliance in terms of S1 127 shall be limited to outliers that wantonly abuse the foreign exchange auction system, exchange rate manipulation and non-compliance with anti-money laundering rules and regulations.
Dr Mangudya added that the Bank’s efforts to curb abuse of the auction system would ensure inflation and exchange rate stability that are necessary for the country’s economy to rebound.
Dr Mangudya further said RBZ had a duty to ensure that progress that the economy had made since the introduction of the foreign exchange auction system in June last year continues on an unhindered positive trajectory, whilst at the same time protecting consumers and fostering fair play in the economy.
Last month, Government gazetted S1 127 to deal with abusers of foreign currency accessed through the auction system. According to SI 127, the central bank can now impose penalties in the event of default in compliance with the Exchange Control regulations that govern the use of funds obtained from the forex auction.
Those found guilty would be slapped with a fixed penalty of the amount equivalent to ZWL$1 million or an amount equivalent to the value of the foreign currency obtained, whichever is the greater amount.
