Biti, a former Finance Minister and chairman of the Public Accounts Committee in Parliament, today said that Zimbabwe will introduce a new currency this week.
“The regime will this week introduce a new Zimbabwe currency not backed by any #reserves & without the context of structural reforms which a prerequisite of currency reform. That move is pure undiluted #insanity. An unbanked currency is just the #bond note by another name,” Biti said.
“There is no country in the world that has involuntarily dollarized that has ever succeeded in de -dollarizing. Zim will not be the 1st. Whilst a currency is about fundamentals, ultimately the most important fundamental is confidence There is absolutely no trust in this regime.”
The Ministry of Information dismissed the report as fake news saying: “Govt has noted with concern falsehoods coming from some political quarters claiming that Zimbabwe will issue new currency next week. This needs to be dismissed with the contempt it deserves. This has no base in fact or reality. It’s unfounded Fake News.”
Biti has been campaigning for Zimbabwe to adopt the South African rand but Finance Minister Mthuli Ncube argues that adopting either the United States dollar or the South African rand is not currency reform but capitulation.
He says adopting the US dollar will make Zimbabwe’s products uncompetitive while Zimbabwe will have to first acquire US dollars to get South African rands.
Ncube, however, said Zimbabwe will have its own currency before the end of this year.
Economist Eddie Cross said the new currency could be introduced in June or July when the economy will have stabilised.
Ncube has also said the economy will have stabilised in six months but he has refused to give a timeline on when the local currency will be introduced saying this will only lead to speculation.