DELTA Beverages said the government must immediately clarify issues relating to the direction of the Reserve Bank of Zimbabwe (RBZ) to create a Nostro (FCA) foreign currency account, cut public spending to revive the ailing economy and withdraw bonds from circulation.
By Melody Chikono
This happened after the central bank last month gave an ultimatum to create an external (external) (external) (FCA) and FCA Real Estate (RTGS) account, as part of measures to maintain value for recipients of foreign currencies and increase market confidence.
In submitting a 2019 budget proposal seen by business people, Delta said some of the country's problems had emanated from the use of monetary interventions to overcome fiscal expenditure which, in turn, emerged from politically driven policies.
Delta said the policy decision had spurred skepticism to believe that the local currency had been introduced through the back door.
"It is very important to maintain a multi-currency system and the value represented by the RTGS balance. The challenge of foreign currencies should not lead to a decrease in national savings. The RTGS FCA must remain convertible, depending on availability of hard currency. Not all bank account holders need to use funds for foreign exchange related expenses, "the company said.
Delta said the government needed to convince Zimbabwe about the value of the current RTGS balance because the prospect of erosion of other personal savings was unimaginable. It is said that clarity is needed on the convertibility of the balance of the FCA RTGS and the need to articulate value conservation goals by strengthening the message of maintaining a multi-currency system.
"At present there is a perception of backdoor dollarization," Delta said.
The company goes on to say that the management of the foreign currency allocation center needs to be adjusted to increase transparency and in accordance with priorities based on KYC banking procedures (Get to Know Your Customers).
There will be a need to move to a market-based foreign currency allocation system. Brewers say important short-term steps in overcoming this challenge, lack of hard currencies such as currency reforms imagined should avoid undermining monetary assets held by citizens.
Important decisions expected from the government include the adoption of an excise regime based on alcohol content with other arrangements on clear locally produced beer at US $ 0.36 / l. Delta said this would approach 35% -37% ad valorem at the retail price target of US $ 0.75 / pint so the need for a clear roadmap in reducing excise rates was in accordance with regional benchmarks.
"Another problem is the bond bond withdrawal. This can stop black market forex trading. Notes are currently not available in retail and banking channels but are available in abundance for forex trading. This will support RBZ's recent directives on FCA separation.