The Reserve Bank of Zimbabwe (RBZ) has frozen bank accounts of four major distributors of basic commodities as President Emmerson Mnangagwa’s government scrambles to find solutions to soaring prices and another currency collapse on the eve of a major election.
RBZ’s Financial Intelligence Unit (FIU) yesterday said it had frozen bank accounts for Saxin Trading, Simrac Enterprises, Brainscope Investment, and Munella Enterprises for allegedly dumping goods on the black market and refusing to trade in Zimbabwe dollars.
“The FIU noted that these errant distributors transact almost exclusively in foreign currency (cash) yet they do not bank the cash as required under the Bank Use Promotion ACT,” the FIU said.
“The entities are being penalised and will further be referred to the Zimbabwe Revenue Authority for suspected tax evasion.
“The FIU has also increased surveillance operations, identifying and taking punitive action against traders engaged in exchange rate manipulation.”
Mnangagwa last week accused business of trying to sabotage his government ahead of elections in August through unjustified price increases and rejecting the local currency.
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Yesterday the Zanu PF leader told people that attended the launch of the National Culture Month in Binga, Matabeleland North, that he would announce dates for the harmonised elections tomorrow.
“When elections are conducted, every person in Binga should safeguard our heritage by voting,” Mnangagwa said.
“I will be announcing the election date the day after tomorrow (Monday).”
The announcement of the election dates will come against the backdrop of economic turmoil and fears that Mnangagwa’s re-election bid would be severely affected.
The Zimbabwe dollar tumbled by nearly 26% on the official market in 24 hours on Tuesday last week, the biggest collapse in one day since the auction system was introduced three years ago.
On Friday, the Zimbabwe Statistics Agency’s (Zimstat) said annual inflation raced 11.3 percentage points from April to 86.5% this month.
Monthly inflation has reached double digits after rising sharply from 2.4% last month to 15.7% in May.
ZimStat measures inflation using a ‘blended’ average of United States dollars and Zimbabwe dollar prices as the economy is now virtually dollarised.
Africa Economic Development Strategies executive director Gift Mugano, who is also a prominent economist, said the economic problems had nothing to do with politics.
“The market is stubborn,” Mugano said in an interview with HSTV.
“The market will not listen to politics. It listens to economics.
“The best constitutional court of the economy is the markets. Government must consult.
“I would like to argue that alternative voices are not bad. They are a mirror.
“I would like a situation in the future where we say we had a meeting and this is what we agreed.
“The command economics in the auction system does not work, the construction sector is creating challenges.”
Confederation of Zimbabwe Retailers president Denford Mutashu said there was need to restore sanity in the market.
“We need to restore sanity in the market. We are currently engaging the government to ensure sanity prevails in the market,” Mutashu said in response to the FIU crackdown.
“During that period we urge business to act in accordance with the law.
“If anyone is found against the law, the law should take its course.
“We are moving to a point where every distributor should do so through formal channels.
“We applaud the FIU for taking the lead.”
Mnangagwa’s government reintroduced the Zimbabwe dollar in 2019 after a decade of dollarisation.
The local currency has, however, lost value significantly amid fears of another collapse.