BULAWAYO – Zimbabwe currently has $200 million of foreign currency reserves and requires five times as much to stabilise the econony, Reserve Bank of Zimbabwe deputy governor Jesimen Chipika said today.
She said the current foreign currency reserves were insufficient to re-introduce a local currency. Zimbabwe dumped its local currency for a basket of multiple currency in 2009 after the economy contracted by more than 50 percent over 10 years.
A perennial trade imbalance has piled pressure on treasury to meet its foreign commitments while local firms appear to be in a rut.
“We are looking at $1 billion as forex cover, but we only have $200 million,” Chipika said told business executives attending the Confederation of Zimbabwe Industries annual conference in Bulawayo.
“If we introduce the local currency we will go back to 2008 and we don’t want to do that.”
“We need to have production of goods and services. There is a reason why we are where we are…the economy was sliding from 2011 to 2016. if we had not put in place expansionary measures the economy was going into recession, negative growth. Some measures rescued us”