By Wellington Zimbowa
RAMPANT illegal currency dealing now mainly effected through mobile money platforms, which have triggered skyrocketing inflation have jolted government into action as the Currency Stabilisation Task Force (CSFT) has been immediately set up to instill discipline in the financial order of the hard currency hit country.
The move brings fresh limelight on mobile money platforms, sparking the 2019 fears over disruption of the financial system that many Zimbabweans have resorted to, due to the high liquidity challenges being experienced in the country.
The task-force is expected to tighten screws on mobile money platforms, which have become an instrument for the illegal trade of foreign exchange, Finance minister Mthuli Ncube said in a press statement, announcing the development.
Introduced recently, the holistic measures, aim to stabilize the exchange rate and contain inflation in-line with government’s macro stability efforts.
“Macro-economic stability is an essential component of the Transitional Stabilisation Programme, critical for economic growth and the achievement of the goals set out in His Excellency’s Vision 2030.
“In order to stabilize the exchange rate and hence, to lower inflation, the Government has decided to implement a holistic package of key policy measures. In this regard, a Currency Stabilisation Task Force has been set up. This will be spearheaded by the Ministry of Finance and Economic Development and the Reserve Bank of Zimbabwe, and will include members of the MPC and PAC, ” he said in a statement.
The Minister of Finance will be chairing the team that will meet at least weekly to review the conditions in the markets, monitor the behaviour of key variables, such as, the exchange rate and inflation.”
On mobile money platforms he said: “While mobile money platforms have made a significant contribution to facilitating trade and payments in the country, they have also become an instrument which is being used by unscrupulous businesses to illegally trade foreign exchange and undermine the economy, “he said.
Prof Ncube decried the laxity of the current financial regulatory system especially on online platforms, which he described as lacking transparency that he said warrants the coming of harsh penalties.
“Our laws and enforcement regime are not as effective as they should be when it comes to crimes relating to foreign exchange and financial fraud. The current legal and institutional framework relating to curbing of trading on the parallel market is quite inadequate. Government will be reviewing all the laws and institutional framework in order to bring them in line with international best practices and more importantly, monitor the effectiveness of institutions charged with implementing the laws. The sanctions framework for illegal foreign exchange trading, will be enhanced to provide for a range of effective proportionate and dissuasive sanctions, including more stringent criminal, civil and administrative penalties,” said the Minister.
Furthermore, daily returns for mobile platforms will be submitted to financial intelligence unit of the RBZ will have a careful scrutiny by the set taskforce to legitimate dealings in accordance with the requisite laws.