Zimbabwe finance minister on Monday said the word “de-dollarization” does not exist in economic terms. In 2009, Zimbabwe “dollarised” the economy by allowing the US dollar and other foreign currencies to be used as legal tender in the country after hyperinflation decimated the value of Zimbabwe’s sovereign currency. The southern African nation ended dollarisation in June 2019 after it outlawed the use of foreign currencies in local transactions in a bid to defend a fledgling interim sovereign currency.
This paved the way for the new Zimbabwean dollar, which formally entered circulation last month. “The de-dollarisation plan, can I persuade you, there is no economic term that’s de-dollarisation, there is no economic term like that it does not exist, so I am not willing to be persuaded that we should be thinking that way,” Finance minister Mthuli said during an online media conference. “We must be pragmatic, we have introduced a domestic currency, the question is it being accepted, stable is it being used for transactions that’s what we have done. So it’s not an issue of de-dollarisation or re-dollarisation.”
Ncube said: “We want citizens to use our domestic currency because that’s the only way we can ensure that monetary policy works as a macroeconomic tool alongside fiscal policy for a full bouquet of macroeconomic”. “So I am not worried about this de-dollarisation debate and so forth, that’s why you find that in public including today, I rarely use this phrase because it’s not economic phrase before I became minister I wasn’t even aware of it, it doesn’t exist and I have written 14 books in economics none of those books have got this word de-dollarisation it don’t exist.”
“So please abandon this debate and focus on stability on the Zimbabwe dollar monetary policy fiscal policy that’s economics,” he added. Zimbabwean dollar prices charge constantly with the movements on the parallel market, piling more pressure on local producers to adopt a currency that brings stability and certainty.