CCC leader Nelson Chamisa has urged President Emmerson Mnangagwa to get rid of the Zimbabwe dollar and adopt the US dollar as the sole currency in order to stabilise the economy.
In a position paper on the state of the economy released on Friday, 29 April, Chamisa said the Government should immediately come up with a de-dollarisation roadmap that takes into account the views of all stakeholders. Chamisa said:
Stop the auction system and go for dollarisation. This will immediately remove distortions, multiple pricing, arbitrage, secure stability and save exporting companies from imminent collapse and help all businesses and economic agents to preserve capital.
… There is a crisis of confidence in the market. Citizens are suffering from the price hikes and the deepening poverty level.
All government policies must be demand-driven, inclusive and fully consultative.
We should immediately work on a de-dollarisation roadmap which is inclusive and evidence-based and built on consensus as opposed to command economics and threatening businesses with statutory instruments.
The Government re-introduced the Zimbabwe dollar in 2019 after a decade of a multiple currency regime which brought relative stability to the economy.
The local currency has, however, lost value alarmingly due to the low confidence in the market and this has triggered inflation and sharp price increases.
Economist Gift Mugano also called for full dollarisation, saying businesses cannot thrive where the exchange rate changes daily. Said Mugano:
We should go for full dollarisation clearly because the current economic trajectory has rejected the Zimbabwean dollar.
It’s difficult for businesses to run their companies when rates are changing every day.
With these ugly indicators, there is no company that can operate sustainably.
In any way, the economy is already dollarised as evidenced by the rejection of the Zimbabwe dollar by retailers.
However, another economist, Maxwell Saungweme, said dollarisation was not sustainable and what the Government needs to do is to stabilise the Zimbabwe dollar. He said:
The fundamental issue is not about dollarisation, but the stability of our local currency. Zimbabwe needs to have its own stable currency.
What must be done is to work on measures to stabilise our local, not advocating for its removal and replacing it with the US dollar.
We need to get our economic fundamentals right, boost our productive capacities and have other clear measures to stabilise our currency.
You can’t run an economy without the capacity to leverage monetary policy instruments.
You lose your capacity to leverage monetary policy instruments.