The foreign currency allocation committee appointed by the Minister of Finance, professor Mthuli Ncube will improve efficiency in how the scarce resources is shared and used while also giving the Reserve Bank of Zimbabwe (RBZ) time to refocus on its mandate of policy formulation.
The government through the RBZ takes 35% of total export earnings with the rest going to the banking sector through nostro accounts.
The central bank had the sole responsibility of allocating forex to various economic sectors, thus compromising its role of policy formulation and implementation.
Minister Ncube announced a nine member foreign currency allocation committee that will oversee the administration and allocation of foreign currency to various sectors of the economy.
The move has been widely commended, with analysts saying it will help to effectively and correctly identify forex needs and monitor its use across all economic sectors.
“This is a great move considering that the issue of forex has not been dealt with in a manner that brings confidence into stakeholders. All forex proceeds will be allocated in accordance to how that forex will be used to benefit the economy. The inclusion of members from other economic sectors means that they are able to spread the foreign currency, though scarce, in accordance to their requirements,” Professor Askok Chakravat said.
An economist, Mr Persistence Gwanyanya expressed confidence in the broad-based nature of the committee as it represents various economic ministries.
Zimbabweans earn over US$4 billion in export proceeds annually, one of the highest in Africa but the challenge lies on the manner in which these resources are being used.
The country has faced critical shortages of fuel, electricity, drugs and other raw materials, and the coming in of the committee, though for the interim, is expected to improve the availability of these key imports.
The committee will be chaired by RBZ Deputy Governor, Dr Khupukile Mlambo and other committee members are from the Ministry of Energy and Power Development, Ministry of Industry and Commerce, the RBZ and the Office of the President and Cabinet.
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