Pindula
Register Login

Something Nasty Will Happen If Zimbabwe Fully Dollarises, Says Mthuli

Something Nasty Will Happen If Zimbabwe Fully Dollarises, Says Mthuli

Finance and Economic Development Minister, Mthuli Ncube, said that it would be economically suicidal if Zimbabwe adopts the United States dollar as the only currency.

Ncube argued that full dollarisation will result in the destruction of the banking sector and local industry will no longer be competitive, among other other things. Said Ncube:

This is what will happen on day one if you adopt the United States dollar as the only currency, something nasty is going to happen.

Four things as a minimum will happen. You will wipe out the entire banking sector.

Because you need to convert their Zimbabwe dollar balances into US dollars, banks will have negative balances. You will have a crisis; you will have no banking sector.

Secondly, very quickly you will have a cash crisis because you cannot print US dollars and there will be a divisibility problem; the small denomination notes will be in short supply and you will start to have cash queues in the banking sector.

The advantage of having a domestic currency circulating with the US dollar is we will have to manage the cash crisis. We have been through this before.

If you remember we had to create something called the bond notes but that was before I arrived, in order to deal with some of the cash crisis.

Also, you will do away with the monetary policy. You need both fiscal and monetary policy or you will be walking with one leg.

So something nasty will happen if you just use the United States dollar.

Ncube said the manufacturing sector will lose its competitiveness if the domestic currency is done away with and the country will be inundated with imports.

On constant fuel price increases, Ncube said the price of petrol would be much higher if the country was not blending with ethanol.

More: The Herald

Share Article

Sponsored

More

93 Comments

Gringo 3 weeks ago

Anotaura zviri mu text book chete


Gringo 3 weeks ago

Mthuli anotaura zviri mu text book chete


Jongwe 3 weeks ago

But help me guys on this analysis, Will dollarisation stir the economy out of the murky waters


Machiavelli 3 weeks ago

No, it will not. Sound economic policies and good governance will.
But in the meantime dollarisation will stabilise the economic downturn and arrest inflation.

Sponsored

More
Abuja 3 weeks ago

Pic yaMtuli iyo inondiSpaka😀😀😁🤣🤣


JC 3 weeks ago

With the improvement in technology these days I think it's time for the gvt to take cryptocurrency seriously. I don't think much harm would be done than already is. Look east and see what China is doing.


JC 3 weeks ago

The minister is making some sense here ...it's hard to live on Usd alone since some looters stock the cash in their homes and money changing becomes a problem: at the same time Zim dollar is not strong enough to stand alone hence half half: as an Economics illeterate I need to know why would they keep on printing the bond notes though when inflation could shoot up like this??


Machiavelli 3 weeks ago

@JC, the reason why people use NMB (National Mattress Bank) is because they have lost faith and trust in the banking system. You will remember in2012 RBZ and government forcibly confiscated People's USDollar accounts and gave them bond note balances. People are afraid of a repeat performance. Simple

Jongwe 3 weeks ago

Very true

stallion 3 weeks ago

zvinotaura minister izvo hazvibatsiri nekuti Mari iri kubiwa me at least every foreigner banking system haisi kuwana foreign currency inoiswa mubank Nama China maindia ve Arab Emirates everyone is looting cash with the blessing of the gvt top brass


sanity 3 weeks ago

we have had a strong currency in the region before , the zimdollar of the 80s was strongest in the region and competative
Please remove the money changers from the streets ,they are fuelling this crisis and compromising government efforts


Dzvamu 3 weeks ago

Vanobviswa nemuromo here or ne good policies. Gvt is clueless chete. Look back nguva ya biti vakabva nei ma money changers.

Ghetto Yut 3 weeks ago

@worzel I agree with you 100%. You are the man


gog eat dog 3 weeks ago

are money changers part of the banking sector ? and why have they gone on unhindered ? Who supplies them with the crispy new bank notes ? where do they meet to set their street exchange rates ? where is our national security forces and intelligence amongst all this abnormalities ? I can go on and on but my last question is how can the poor and honest citizenry fare in all this ?


mzalu a Jola in Jo'burg 3 weeks ago

The fact is true taurai chimwe chokwadi chakadzika dzika prof


Gafa 3 weeks ago

Kklkk vagwere vepfungwa vazere zvino ukati handidzimi moto nemvura imba ino****va wodzima nei iwe uri paruware.Uchabvuma hako USD racho.Anoda kuchengetedza basa raMangundya rokuprinter mari manje zvadhakwa .


Hwenyakwese 3 weeks ago

Mthuli sounds like he is in denial
Or is it me?
Only time will tell.


Chamisa junior 3 weeks ago

Shiri dzinofa


Marehwarehwa 3 weeks ago

methinx mthuliis conflicted.so much talk from one who is earning US $.
I would believe him if ,as a civil servant, he was earning RTGS.
Mthuli & Mangundya should consider this Everytime they elect to profer their wisdom.
Soon time ,gully a go red
Can't find $ to buy a piece of bread!


mafirakureva JoJo chenjera 3 weeks ago

hakuna rigging inoitwa pa economics ....newe unoziva bad money chases good money ....you cannot dance for your supper and deceive everyone here ....you have failed the masses mthuli you are a pappet and a sellout ...so you think you can kill the lives of Zimbabweans for your selfish interest ....zvakaitwa na Bit zvikabhadhara vanhu vachiona iwe watadza dzokera vaite Ivo vanoziva chete


gabarinocheka 3 weeks ago

the higher the monkey climbs the tree
the more it exposes it's behind...


. 3 weeks ago

Word

Po 3 weeks ago

haiwa we dnt want explanations here we need answers taura hako $ ......zvamuramba uyo


$ 3 weeks ago

Incompetent !! faiked economics ....ukaona uchitadza ku controller price uechingwawa....unoti Parirenyatwa pane chinobuda here ikoko. Zimbabwe byou are killed makatarisa !!


Tkt 3 weeks ago

Honestly I foresee the USD being abused again
You @Worzel & like minded you think the $ will remain the same as the day it will be introduced
When the $ was introduced in 08, everyone earned about 100us
By 2013 almost all those that earned 1lthe 100 we're now getting at least 400us how much Inflation had been cultivated in those 5yrs?
The GNU was better that's what you think huh, then how did it fail to maintain the purchasing power of the first 100 letting is go as far as 400?
This is Zimbabwe bro, not even chamisa can do this I bet with you!
He will be the first President to resign leaving office together with his entire trusted cadres.
Though he won't make it that far


Machiavelli 3 weeks ago

@Tkt, your financial illiteracy is worrisome. When Biti dollarised in 2013, he pegged every civil servant at US$100. Four years of prudent fiscal policies enabled him to increase salaries to an average of US$400 four years later. It wasn't because the US$400 of 2016 had the purchasing power of US$100 of 2013.

JoJo chenjera mafirakureva 3 weeks ago

@Tkt
the GNu dn't fail
Chamisa as a new faCE can gain trulife usashandisirwa mabond kuita murakashi Kura
he won't loot or let the dollar be abused with Bit
there is new hope in them since ntuli Ncube is admitting failure to do wat Bit did for everyone to see
get a li

student 3 weeks ago

@worzell perfect analysis👏👏👏👏


Sca 3 weeks ago

Mthuli, pa**** paamai vako. Usaite kunge zvinonzi hautambire maus papay Palo. Saka vhara kamuromo kako kenhunzi ako, kanonhuwa Fifi.


xlt 3 weeks ago

**** nja

Da Truth 3 weeks ago

Pliz Zanupf go to Chidzero ,s grve and ask for real solutions,Kombo Moyana,L l TTsumba and Tendai Biti vane ma answers Kare asi kunyara .


baba vabona 3 weeks ago

@blue your father is looking for you kkkk


baba blue 3 weeks ago

blue my son where are you? clueless Mthuli is saying these things ari pamusoro pechamber. Mangwana achataura kuti lets dollarise mark my words he will eat the humble pie. Ari kunzwa **** uyo


Bee 3 weeks ago

Haa pic chete Pindula makanyanya


Boy 3 weeks ago

Ana mthuli vari kuita Mari yakasvika naro zimdollar iri ndokusaka vari kuti something nasty will happen if we fully dollarise so people musafunga kuti pane zvine musoro zvawataura


biggie smalls 3 weeks ago

ok the whole issue circulates around beauty and the beast, ok i c


Swagger 3 weeks ago

chi blaz ichi changa chirukupi vamwe pavakizvama but it didn't work iwe wakuda ku repeater the same.Mugabe 2015 akati hatichadi US$ akaisa chi bondnonsense chakatisvitsa kupi chimari chenyu now inflation is rising UKWANE Mthuli


NF 3 weeks ago

Vote CCC


dr mkosho 3 weeks ago

mayouth haazobhadharike pama upcoming elections 2023...

but zvakanaka coz these guys have lost the age of a common man... ndiko kut vazvamburwe zvine mutsindo naNero

Vote CCC
Vote for Change
Chamisa 2023


ABSA 3 weeks ago

Ndozvandaitukira Gono izvozvo zvekusa kwana


fun time 3 weeks ago

Due to circumstances which feed speculative tendencies in this country we have already dollarised the economy but we have not received official communication to that effect. It was done stealthily to avoid unintended effects which normally come from saboteurs of any economic progress until the leadership is changed. the hawks kkkk.


The Zebra 3 weeks ago

But when our former president left , things were in order until when Mhuli told us that the USD wasn't at par with the bond notes


clt 3 weeks ago

nxa

fun time 3 weeks ago

Our economy lacks confidence the professor is losing confidence by the day. Our politics is undermining economic progress. if we substitute the country's leadership with someone who has people's confidence we wouldn't have to struggle to reset the economic fundamentals whatever they are. Kuseri kwe bepa ndiko kune answer even the professor knows that.


Jah🇿🇼Tsvarie-07 3 weeks ago

We are suffering now, imagine getting paid to buy forex and at what rate?
Mthuli and family are not in the situation we are in, things are tough business are selling in US$ and paying salaries in Rtgs$ while the government is watching and asking us to have faith in Rtgs$ which they dont even give to their ECD kids 🤔


Cable Guy 3 weeks ago

Well said 👏👏👏👏👏👏👏

Honorable 3 weeks ago

The minister is not being sincere at all. Why do we have government services being levied in US$ to the poor citizens who are being paid in valueless RTGs. Even the minister is not even paid in RTGs

Actor 3 weeks ago

Hatibvise mari yemuno. ma youths tinozovabhadhara neyi pa campaign ya 2023.


𝗠𝗮𝗿𝗮𝘃𝗮𝘇𝗮 3 weeks ago

𝗠𝘁𝗵𝘂𝗹𝗶 𝗺𝘂𝘀𝘁 𝗰𝗵𝗼𝘀𝗲 𝗯𝗲𝘁𝘄𝗲𝗲𝗻 𝗱𝗼𝗹𝗹𝗮𝗿𝗶𝘀𝗶𝗻𝗴 𝗮𝗻𝗱 𝗷𝗼𝗶𝗻𝗶𝗻𝗴 𝘁𝗵𝗲 𝗥𝗮𝗻𝗱 𝗨𝗻𝗶𝗼𝗻 𝗶𝗳 𝘁𝗵𝗲 𝗱𝗼𝗹𝗹𝗮𝗿 𝘀𝗰𝗮𝗿𝗲𝘀 𝘁𝗵𝗲𝗺.


fun time 3 weeks ago

Joining the rand union requires us to have our own currency and handing over the control of our monetary policy to the South African Authorities.

Tio4 3 weeks ago

The nasty thing that will happen is the rbz will be left redundant, we will not run the printing press to print new notes and considering next years election the zpf party will be left technically hamstrung with no printing press to print money willy nilly


Joe Brownn 3 weeks ago

anoda kugadziriswa pfungwa Mturi Ncube we once used the USD as the only currency here and everything bloomed until Zanu-PF started looting our hard earned money.


Dr Simon Cowell 3 weeks ago

Fair and fine those are the reasons why Zim shud not fully dollarize. But he should also enlighten us on wht is most likely to happen if inflation continues at this pace. Mthuli should not be biased in his assessment he should talk about both sides of the story. At this pace inflation is likely to reach 4000% before elections. If tht happens then wht?


Slamey 3 weeks ago

I beg to disagree with the finance minister. Our local currency haisikuita zvakanaka , so by saying kuti if Zimbabwe adopts usd something nasty will happen, I disagree ipapo, bond handina anorida pa fair , zvekuti USD rinenge risasawanikwa handizvo prof ko iro bond racho ririkuwanikwa here muma banks macho.ipapo does he have account ye zwl or he got USD account , even salary yavo is it zwl bond or in USD ? Mheno kuwona kwanguwo, and also prof ngavazive kuti there is a difference between teaching and practising, economics dzinoda action not kutaura idzo dzema book hazvibudi


Zvazvanga zvingori 3 weeks ago

Hold your horses.A half backed professor


Mudiwabilley 3 weeks ago

@Nerd, Worzell Gummidge has it all, praise him instead of Mtuli.


mafirakureva JoJo chenjera 3 weeks ago

@nerd ndiye akuziva varakashi ana blue avo siyanai navo they are dancing for their supper knowing they are tuning **** stuff

Lawrence van Wyk 3 weeks ago

it is these same people who've made it possible for us to be in this position.
Kutoti its happened before and you still fall into the same trap🙌🏾


student 3 weeks ago

vote ZANU PF 2023

NYIKA INOVAKWA NEVATONGI VAYO


Dirigsme 3 weeks ago

Technically the learned professor is ringing the alarm bells. Point taken but as a long term measure we need to talk to the Politburo,Central Committee & High Command & General Staff of the ruling part to stop stealing (looting). To respect human rights. To adhere to the Constitution. To worship property rights. To bring back Moreblessing Ali. And resurrect Itai Dzamara. Eliminate the ferret forces. And gracefully retire George Charamba & Ndavamaningi Mangwana. Then finally post Chris Mutsvangwa & his entire family to Donbass in Ukraine.


Da Truth 3 weeks ago

State sponsorship of terror groups leads to investor scary Halloween era.We can jump ,spin, twist and bend.But economic growth is riched at when the truth is allowed to take action top to bottom.Zim needs serious pple who love this country.Vanoyenga dzimba muno kwete Malayasia .Vane vana vanodzidza muno vachiona matambudziko arimuno.If u like your nextdoor ,s house so much that you buy property for that house .Zim is doomed ,My fellow country man we are doomed . Unless we change our minds we are done.

Blue 💙 3 weeks ago

The "improprieties" you have listed have nothing to do with the economy.

An impropriety such as drug dealing prevented global finance collapse in 2008. The global financial system was literally saved with drug money. Right now that impropriety is preventing the collapse of the Malian economy, soo listing a few so-called crimes don't mean anything. There's crime and human rights abuses everywhere.

Worzell Gummidge 3 weeks ago

How come nothing nasty happened during the GNU era when Zimbabwe fully dollarised? The nastiness only started to happen when Bond Coins & later Bond Notes were introduced. Fiscal policy is not written in stone, it can be amended overnight by the legislature or the executive. The assumption that Banks will have negative balances or negative liquidity is an admission that Banks are maintaining reserves of useless or valueless money which will be wiped out by the introduction of a stronger currency. Manufacturers who export already receive payment in hard currency, hence dollarisation will be an incentive to increase exports in the manufacturing sector. Full dollarisation will actually strengthen the banking sector by encouraging deposits of strong money which stores value.


sekuru waBona 3 weeks ago

allow me to say my two cents gents

the Treasury is shying away from addressing the deep rooted problem that is making the citizens shy away from the Zim dollar

monetary policy inconsistencies

lack of business trust between government and industry

policies intended to thwart developments in urban areas held by opposition

corruption

an inept cabinet busy window dressing

funding of infrastructure through money printing

party politics against national development

the always right mentality

**** in a nutshell the present government has failed in every sector hence the public doesn't trust anything that it does and what does it do?

look elsewhere hence the US,it will take ages before the citizens embrace the Zim dollar

Blue 💙 3 weeks ago

Okay. I thought we were comparing the GNU era with the new dispensation, but okay, it's cool.
Firstly, it's only propaganda if it's misleading. l Just stated facts there, like l always do.
Secondly, no one bailed out industry under the new dispensation. Correct me if I'm wrong. Industry during GNU times couldn't keep up with cheaper imports of better quality. For example, there was no way a company like Prochem would compete with Nivea products. They invoked some statutory instrument, should be 68, to try and hslp local industry. It didn't work as expected.
Thirdly, we all know who lobbyed for sanctions, so that suffices.
Fourthly, that 15 Billion dollar figure wasn't true. It was an inflated figure. Besides, grap a atlas and pick a country without corruption, if you can find one. Maybe Atlantis but who knows where it is.
Lastly, policy inconsistencies were caused by a lack of identity as far as currency is concerned. That is the identity the government is searching for by sticking to the Zim dollar. Going full out US dollar would just reset progress. That would become a problem again when you want to reintroduce the Zim dollar again.
I could go on and on but l feel the lactic acid building up in my finger muscles.

Worzell Gummidge 3 weeks ago

@Blue my Brother. You appear to rehash or regurgitate the official narrative/excuse concocted by the state's propaganda gurus.

Excess imports over exports were a result of failure to bankroll, capacitate & bailout local industries. Remember the partisan land reform & empowerment of Zanu PF Chefs had already destroyed agriculture which had been the best in Africa. Now the Chefs who own the farms spend all their time in Cabinet & party meetings while the farms lie idle. Tell me what exports can come from that?

We had a thriving manufacturing sector which rode on the back of agriculture & mining. All those companies moved to neighbouring countries, now we import what we used o produce. There we're massive policy inconsistencies that discourages Foreign direct Investment & local investors were victimised courtesy of Zanu PF. There was obscene looting of diamonds, which Mugabe said was to the tune of US$15 Billion, and other mineral resources which are still not being accounted for.

If I can ask you now, how many Chinese owned mines do we have in Zimbabwe? How much is their output? And how much tax are they paying? It's a closely guessed secret & kickbacks go into private pockets.

Government expenditure mainly consisted of Mugabes perrenial foreign trips, luxury cars for the chefs & salaries for ghost workers & secuty services which produce absolutely nothing.

I could go on, but, matter, energy, space & time are a limitation.

Blue 💙 3 weeks ago

Something nasty occurred in the industrial sector. If you can still recall, Zimbabwe imported almost everything. If my memory serves me well, 90%of products in supermarket shelves were imports.
The bond coins were introduced because people were tired of buying the stuff they didn't need. Remember, change was a mess. Even though, with the massive trade deficit we had back then, cash shortages were looming. They were yonder, sneaking up on us, waiting to punch us in the mouth.
Thirdly, government expenditure was so high there was no room for infrastructure development projects.
I could go on...

Ed 3 weeks ago

Printer yavo inenge yashaya basa. Apa going into elections


Baba Gumede 3 weeks ago

The minister is correct here , I think that 50% bond and 50%Usd salaries is the way to go .


JoJo chenjera mafirakureva 3 weeks ago

vanokwanisa here kupa bond 0rosvika pa poverty datum line Kuma more than 130 000 .... vanenge votoita zvagono zvekubvisa ma zero kaa...azvishande just follow Bit chete kwete ma**** awo

Mmmm 3 weeks ago

Something nasty happened when we introduced the Zim dollar and is still ongoing.


syst 3 weeks ago

Iwe Blue 💙unongowawata Zim haisi kubudaa out of it's economic chaos and imi varakashi muri kufara nazvo.Mune utsinye and iwe unombopihwa chiiko kuti unyore n o n sense dzako pano apa????

mafirakureva JoJo chenjera 3 weeks ago

aah akuna super power rakamgoita inflation yedu iyo my modern world into ITA steady

Blue 💙 3 weeks ago

A currency or economy is just as resilient as the people using it or in it. Even the so-called "super powers" were bedevilled with financial depressions time and time again. But they got out of that.

zid 3 weeks ago

So it ismaking sense to print money that people Will not que for coz of its value


Observer 3 weeks ago

Yes the people will be happy, goods will be affordable and that is very nasty.


syst 3 weeks ago

Do I have to believe everything that Mtuli Ncube says?
We have walked the path before and it was very fruitful.Yes we could afford a decent meal during dollarisation,tainge totopfekawo hembe dzekuEdgars,Jet..,vana vainge votozivawo pizza, I even managed to buy myself a car and good furniture.Right now hembe dzandiri kupfeka ndedzekare Edgar's but ukadziona dzichitori dzakanaka.
What happened then?Mbavha dzakati ngatitii rate reBond neUSA 1:1 bhora ndobva raenda musango.Vakazviitirei ?Kuda kuLooter plus GNU iya yaiva yakanaka zvekuti unoshaya kuti sei Zanu yakazobhura vanhu nekuvauraya iye Tsvangison anga azvihwinhira.I won't forget what we went through not even in a thousand years.Mugabe was forced into office 28 March, people lost their lives kuti Zanu itonge futi .You think that people have forgotten?????Kwanai varakashi hamunei neFuture why????

mafirakureva JoJo chenjera 3 weeks ago

change yeiko iwe bhalanzi murakashi vashandi vari kupiwa 20usa pamwedzi wese naye uyo
change marands ariko huya byo uone uchipiwa change yako yes iwe
inclusive ana Bit vakaashandisa awo vanhu vakatenga dzimba nemota pension dzikashanda ezvino apana
bvumai chero Imi varakashi vasina future munongodawo kupiwa 10 USA yekupindurawo panotaurwa modawo Mari kwayo .....looting yagara inonetsa pasina kuchinja bond chete uye Mari dzouya dzonetsa kuti vakuru vake vane iri USA chete coz vanoshandisa zvima fake rate izvo kutora Mari dzema donor voforcera vanhu kutenga kwavari vasara nemari Ivo voendesa vana kuchikoro kuchando nekuno shopper Dubai
Imi muchihumana nekuda kweka 19 USA kekuvhiringa vanhu pa social media vana vachidya nhoko dzezvironda ....blue **** kwana iwe ITA mushe akonewa blaz wako ipai Bit nyanga anoziva

Bob marley 3 weeks ago

hooo tym willl tell

Blue 💙 3 weeks ago

I agree. People's welfare takes precedence over everything else, but not with the USD. Nope, it's not sustainable, it's not ours. Mthuli said it, not all, but some major points.

Worzell Gummidge 3 weeks ago

@Blue. Stabilising prices, boosting the economy and improving people's living standards takes precedence over small amounts of change. You can't complain if you buy a loaf of bread for US¢50 with US$1 note. If there's no change you just buy 2 loaves. It's better not to have quarters, nickels & dimes when the money you using stores value. Unlike the current scenario where workers are paid in Bond Paper which loses value daily. With Bond Notes one can work for 30 years, upon retirement, the bank charges for withdrawal of the pension already exceed one's life savings.

Blue 💙 3 weeks ago

It will be all fun until you buy something half a dollar and you want your change back. We would need nickels and dimes, and those are even in short supply in the States. What will you do then? I wonder 🤔

bigsam 3 weeks ago

ticharishandisa hedu


Chimboti Pizza 3 weeks ago

Mashoko makukutu ataurwa naVaMthuli, handisi weZANU zvangu but kunaka kweZimdollar ndinokuziva
#ZimdollarHaripere


Blue 💙 3 weeks ago

🤗

Nerd 3 weeks ago

What he's saying is true
but zvaisafanirwa kutaurwa naMtuli Ncube.


linox 3 weeks ago

kkkkk guys don't be political minded

GThing 3 weeks ago

😍😍😍😍😍



Leave a comment


Recent News


News Categories



Give us Feedback