Finance Minister Mthuli Ncube's currency reforms paralyse black market, money changers in trouble

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THE currency reforms introduced by Treasury on Monday this week, which culminated in the scrapping of multi-currency system on local transactions, have paralysed the black market in Mutare where money changers are now singing the blues.

Black market foreign currency traders who spoke on condition of anonymity said they would receive US$10 000 and RTGS$10 000 everyday to feed the parallel market but the suppliers have since stopped. Yesterday, the rates had tumbled significantly as the RTGS dollar was trading at between 6,1 and 6,5 to the American dollar on the parallel market.

“We used to receive large amounts everyday so that we would buy and sell at a profit in the streets. Business was brisk because we would be able to cash in and make 80 percent profit on a daily basis. We would be assured that every day the rate goes up and that would give us every reason to stay in the streets but things have changed ever since the multi-currency system ended on Monday. Most of my colleagues have since disappeared because suppliers from Harare who would give us the cash have since stopped,” said one illegal street money changer.

A snap survey by The Manica Post this week showed that most street money changers plying their trade in Mutare Central Business District had since vanished from the streets because ‘business’ was no longer viable.

Another street money changer had this to say: Those who used to supply us with EcoCash and cash have stopped soon after the announcement of the scrapping off of the multi-currency, a development which saw most of our colleagues leaving the streets. We had more customers who would come with US dollars and then we wire some money through Zipit or EcoCash.

“This has since stopped because the rate has tumbled. I personally got some money which was in my EcoCash account frozen because I would be involved in a lot of transactions. Clients from agents such as Mukuru and Western Union are now opting to keep their money or visit bureaux de changes for safety and higher rates.”

Said another illegal money changer, who has now switched to selling second hand clothes: “Money changing had remained one of the few viable income-generating activities for ordinary people like us working for those in high places who have access to both cheap foreign currency and big RTGS balances. We are grounded and I have since surrendered the EcoCash account to my bosses, who would send me because, like most of us, I was working for someone.

“We however hope that the Government will deal decisively with the forex tycoons or else no amount of legislation will kill the money changing business.”

Added another money changer: “I had invested a lot of money buying forex hoping to cash in big time as the rate was shooting through the roof, now I have been hit by the proverbial sucker punch and I don’t know if I will be able to recover from this. It’s better to stay home because we expect that the rate will be one is to one come next week.”

— Manica Post


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