Biti says the RTGS$ will be 15:1 to the US$ in six weeks


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Movement for Democratic Change vice-president Tendai Biti, who has been a strong proponent of dollarisation, says the recently introduced RTGS$ will be trading at 15:1 to the United States dollar in August.

Biti, who was Finance Minister during the inclusive government from 2009 to 2013, dismissed sentiments by President Emmerson Mnangagwa on Friday that the RTGS$ was the strongest currency in the region.

At the moment, it is indeed the strongest currency in the region. Today it was trading at 6.08 to the greenback on the interbank rate but way down at 9.7 on the black-market.

The Insider understands that business wants it at 10:1 but at 15:1 it will almost be at par with the South African rand.

Former MDC policy coordinator Eddie Cross says the RTGS dollar should be trading at 4:1 because the fundamentals are right and asked the government to punish the speculators who were manipulating the exchange rate.

Biti had a tiff with current Finance Minister Mthuli Ncube in Parliament over the exchange rate last month with Ncube accusing him of destroying the central bank’s ability to conduct monetary policy when he dollarised the economy.

He tweeted: “In August 2019 the RTGS$ will trade 15:1 to the US$ There is no production yet consumption levels are huge. To therefore claim that Zim has strongest currency in the region is both zany &unscientific. Those who have authored this crises should simply zip their cartel mouths.

“It will be impossible to turn around this economy without resolution of the political crises. No amount of lies & tampering will alter this fundamental fact. The sooner the cartels, muppets and mafia mis-running this country understand this the better.”

Ncube argues that the transitional stabilisation programme that he introduced in October last year and runs until next year is beginning to pay off.

He says the government now has a surplus on a monthly basis for the first time and argues that prices will start falling next month.

Zimbabwe’s prices are currently pegged on the black market exchange rate of the RTGS dollar against the greenback. They can, therefore, only fall if the RTGS dollar appreciates against the United States dollar.

Biti, who was elected MDC vice-president at the party congress last month, says Mnangagwa will not last if office up to the end of this year.

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The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.

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