RESERVE Bank of Zimbabwe (RBZ) Governor Dr John Mangudya says more individuals and companies continue to heed Government's call to repatriate funds salted away in prior years.
The RBZ is next week expected to release an update on the funds brought back since the end of a moratorium that took effect from December 1 last year.
Government is working on recovering $826,5 million; which remains outstanding, almost two-and-half months after the March 16 deadline to bring back the money.
By March 19, externalisers had returned US$591,1 million out of the US$1,3 billion estimated to have been siphoned through payment of imports not received in Zimbabwe, non-repatriation of export proceeds and funds banked in foreign banks in cash or under unclear circumstances.
Last week, Dr Mangudya told The Sunday Mail Business that more firms and individuals are coming forward with funds previously stashed in offshore accounts.
"We are pleased by the response as a number of entities are clearing their overdue obligations," said Dr Mangudya.
"We have also received support from business organisations, especially CZI (the Confederation of Zimbabwe Industries), in ensuring that their members comply with rules and regulations.
"We have seen a significant move on compliance."
Asked if more companies and individuals were keen to bring the funds, Dr Mangudya said, "Yes indeed."
Returned US$591 million a drop in ocean
When the RBZ announced in March that US$591,1 million had been brought back, ordinary citizens said they expected a major improvement in the cash situation in the country.
However, cash shortages persists and "on a good day", depositors get coins from banks.
Productive sectors also say they have not realised a significant rise in approvals for foreign payments since March.
UK-based strategic analyst Mr Hopewell Mauwa, says citizens wanted to see a boost in the money in circulation following the return of the US$591,1 million.
"The inflow of funds would have boosted national foreign currency reserves. That would have allowed the Reserve Bank to stabilise the cash situation in tandem with the Afreximbank revolving facility.
"Once the bond notes in circulation are backed by sufficient hard currency reserves, the US$/bond arbitrage would then be addressed. That would have given ordinary citizens confidence to hold savings in the official banking system, which is the ultimate goal," said Mr Mauwa.
But CZI president, Mr Sifelani Jabangwe said he did not expect the returned loot to have significant impact in the economy given the many competing demands.
"The biggest challenge is that the money was inadequate in the first place. This is worsened by the fact that the performance of industry has also gone up by 20 percent.
"However, we have managed to maintain our production levels and we are encouraging our members to increase exports to generate foreign currency," said Mr Jabangwe.
Indeed, the industry has upped production in recent months with new firms also being established, pushing up the demand for foreign currency.
Giant beverages manufacturer, Delta Corporation, reported in its results for the year to March 31, 2018 that total volumes, excluding associates, had risen by 14 percent. Lager and sorghum beer volumes grew 27 percent and 9 percent respectively compared to the prior year while the sparkling beverage volumes rose 15 percent. Last week, packaging material maker, Nampak Zimbabwe Limited, announced in its interim results for the six months to March 31, 2018, that its revenue was 23 percent ahead of the prior year due to improved demand.
Similarly, horticulture firm Ariston Holdings reported last week that its revenue for the half year ended March 31, 2018 had surged to US$5,31 million, representing a 53 percent jump due to "the combined effect of significant volume and pricing improvements".
Apex bank boss Dr Mangudya conceded it was impossible for the returned funds to have a significant impact in the economy.
"The impact of returned funds on the economy is neutralised by the current high demand for foreign exchange within the national economy, more so, given that the repatriation of funds is a process and not an event," said Dr Mangudya.
A number of new companies such as Varun Beverages, which is bottling the Pepsi beverage under contract, have also started producing locally.
This means instead of approving foreign currency payments for Delta alone, the RBZ has to also budget for Varun Beverages.
Citizens have right to know
A director at UK-based Multi-Asset Strategies, Dr Brian Mangwiro, believes Zimbabweans have every right to know how the US$591,1 million repatriated so far was used.
Dr Mangwiro said for the ordinary person, the money should have been "re-deployed transparently".
But he also admits that the amount brought back is too small to improve the deeply entrenched liquidity crisis.
"On one hand, the public is right to insist on transparency, and this is not to suggest that there was a misuse of funds. However, expectations on how much these funds will transform monetary conditions and improve cash availability look unrealistic.
"On transparency, the Government should have disclosed what the funds were used for in the fiscus; whether it's paying salaries, settling arrears in foreign currency or importing critical needs such as medicines," said Dr Mangwiro.
He believes that would have gone a long way in improving public perception.
Dr Mangwiro said transparency has the ultimate impact of encouraging depositors to use the formal banking system.