EDITORIAL COMMENT: Stop spreading misleading information on bond notes Dr John Mangudya
Reserve Bank of Zimbabwe Governor, Dr John Mangudya

Reserve Bank of Zimbabwe Governor, Dr John Mangudya

THE impending introduction of bond notes is causing tremors on the market and has been mired in controversy with the public skeptical of the notes while monetary authorities have sought to reassure Zimbabweans that they have nothing to be concerned about.

Despite going to great lengths to explain the rationale behind their introduction and the envisaged benefits to the economy, there has been a run on banks as depositors seek to empty their accounts as quickly as possible while on their part, banks have been restricting cash withdrawals.

Very few individuals and corporates are depositing cash in banks and this has worsened the liquidity situation in the system. Clearly, the Reserve Bank of Zimbabwe has its work cut out in as far as the bond notes are concerned and we feel it needs to embark on a massive educational awareness campaign to dispel the myths around the notes and misconceptions that authorities are trying to reintroduce the Zimbabwe dollar via the back door.

The jitters on the market are real and as we report elsewhere on these pages, the RBZ Governor Dr John Mangudya is a worried man as he navigates the path to the bond notes introduction next month. There have been half-truths, outright lies and misleading information peddled by mischievous people preying on Zimbabweans’ penchant for latching onto anything remotely negative about their  country.

It is alarming that people are prepared to believe the garbage being churned out on social media but are skeptical of information relayed through formal channels by the Government. Given the traumatic economic challenges of 2008, it is tragic that some Zimbabweans are comparing that era with the imminent introduction of bond notes when it is clear as daylight that the circumstances are vastly different. Bond notes are an export incentive and are not meant to replace the multi-currency system and the sooner members of the public understand this the better.

The fact that they are being introduced in small denominations of $2 and $5 means that there will be minimal speculative behaviour spawned by their introduction on the market. When the RBZ rolled out the bond coins to deal with the problem of change, skeptics were quick to dismiss them with some even urging the market to resist them. Now they have replaced the rand and pula as a medium of exchange as they are at par with the US dollar.

The same skeptics are lauding the RBZ for a masterstroke decision. How ironic! We therefore argue that the trepidation surrounding the introduction of bond notes is totally misplaced and urge Zimbabweans to embrace them and desist from fuelling unfounded rumours and misinformation about the notes. Responding to reports that foreign currencies in bank accounts would be converted to bond notes when they are finally introduced, Dr Mangudya said there was no need for bankers to panic as their money would remain in the currencies it was before the introduction of bond notes.

His assurance came after revelations that some shops were no longer accepting plastic money for fear that their money would be converted to bond notes when they are introduced in due course. They are understood to be now taking cash payments only. But in an interview with our Harare Bureau, Dr Mangudya implored the media to play their role in educating people about the bond notes. “There is no relationship between plastic money and bond notes,” said Dr Mangudya.

“The two are, instead, alternatives. It is the role of the media to also clarify that there would be no notes accounts and there would be no conversion. Any money in the accounts can be spent through plastic money.” Weighing in on the debate, Zimbabwe National Chamber of Commerce (ZNCC) chief executive, Mr Christopher Mugaga, said there was a lot  of skepticism about the bond notes.

“It is for that reason that as ZNCC we are hosting a breakfast meeting with Dr Mangudya on Thursday (today) so that he can explain the position on bond notes,” he said.

“If you look at the bank transactions at the moment, about 4 percent only at any branch are deposits, which goes to show that there is a serious problem. If people cannot deposit, it means that even the issue of plastic money comes into question.

“Dr Mangudya will have an opportunity to explain to people so that they understand. As we speak, people are moving their cash outside the country because they have not understood what the bond notes seek to achieve. He just has to be clear to business that he will not tamper with people’s money to restore confidence.” We welcome this initiative and are hopeful that the RBZ boss will address some of the misconceptions around bond notes.

In the meantime, we urge Zimbabweans to desist from spreading malicious and misleading information about bond notes.

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