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Thokozani Zondo
I write adding my voice to that of Reserve Bank of Zimbabwe governor Dr John Mangudya on the introduction and adoption of bond notes alongside other measures being taken as we seek to revive our economy.

The essence of my writing is to share my common understanding of the bond notes from an ordinary citizen’s point of view.

I primarily understand that this is an Export Incentive/Bonus Scheme targeted at our various exporters across the country. The aim is to complement the exporter’s efforts by boosting local production for the export market.

Our exporting companies are to be incentivised according to their performance and will be rewarded a bonus/incentive of up to five percent discretionally by RBZ.

The measures are aimed at addressing low productivity levels of goods and services which are falling short in generating sufficient levels of foreign exchange to meet the economy’s requirements both domestic and external. The percentage bonuses will be paid in bond notes to the deserving companies through the normal banking system.

As we speak, bond notes are coming into circulation by end of October 2016. It is estimated that by year end, bond notes worth $75 million will be in circulation representing collective bonuses/incentives rewarded to various exporters of goods and services in our economy.

I therefore encourage our hard working exporters of goods and services to take advantage of this noble scheme which should catapult them to boost production efforts in order for them to earn the much needed foreign exchange for the nation.

As rightly pointed out by Dr Mangudya, the cornerstone of economic development of any country is the production of goods and services.

Therefore the sustainability of the multi-currency system already in place in our country is dependent on the economy’s capacity to generate sufficient foreign exchange to meet its requirements.

The bond notes therefore, which will be paid on export earnings already received into the country will be gradually injected proportionally into the market in line with the export receipts thereof. This is indeed hailed as the restricted injection will safeguard the economy from inflationary tendencies, which is a major fear to many of us.

Our general public needs to understand that the bond notes will have a sustainable value derived from the $200 million facility guaranteed by the African Export Import bank (Afreximbank).

As a medium of exchange, the bond notes will circulate alongside other official currencies in our multi-currency basket such as the US$, the British Pound (GBP), South African Rand (ZAR), Botswana Pula, just to name but a few.

The main area of concern to the ordinary citizenry is whether the incoming bond notes will ease the problem of cash shortages in the market.

Indeed the bond notes are intended among other things to bring relief to our people who have for a long time endured the anguish of long queues while trying to access their hard earned money from the banks.

Already, our central bank is working diligently with relevant stakeholders on the embracing and use of plastic money. We understand the uptake of Point of Sale machines by providers of goods and services has reached 40 percent to a targeted 60 percent uptake by year end. This is indeed a step in the right direction as we seek to move to a cashless economy.

The circulation of bond notes will further complement positive steps already being implemented by RBZ such as the reducing of cash limits that individuals and corporates can withdraw per day including the reducing of cash that travellers can carry out of the country.

These measures are indeed hailed as they will go a long way in curbing money laundering and externalisation of the currency by some unscrupulous individuals and business persons alike.

It is noteworthy that while the generality of the nation’s citizens will benefit by accessing the physical notes (bond notes) in circulation, the primary aim is targeted at our exporters of goods and services. This is vital for our citizens to know and appreciate as export proceeds are the lifeblood of any economy.

Having said the above, I wish to highlight the fact that the monetary policy from which the idea of bond notes has been coined is only but a component inside a whole basket of economic measures that should work together to stimulate our economy.

As such the introduction of bond notes by the RBZ needs to be complemented by other ministries’ efforts e.g. Industry and Commerce, Finance Ministry in terms of its fiscal planning.

Fiscal planning must of necessity be concomitant to the proposals as enunciated by RBZ in its monetary policy. This is very crucial as pulling in opposite directions by key ministries will see us achieving nothing. The RBZ is simply doing its work and needs our support.

As I conclude, I wish to applaud the RBZ governor, his team and many other stakeholders that have participated positively leading to the actualisation of bond notes.

I wish also to reiterate the fact that bonds notes will on their own not solve the entire economic challenges that our economy is facing. They will, however, go a long way in boosting the supply side of the economy.

Furthermore, bond notes will mitigate the effects of the cash crunch in the market.

A lot of productive time is lost when people spend a lot of time queuing in banks. The economy is the people hence when the economy suffers the people suffer too or vice versa.

Having said the above, it is imperative that RBZ’s efforts be complemented. There is need for close co-operation by other line ministries and a purposeful harmonisation of working relationships by all stakeholders.

Allow me to end by enlisting wisdom from the IsiNdebele saying which says, “Injobo enhle itshukelwa ebandla” phosa elakho lawe.