Zimbabwe scapegoats, blacklists 19 companies for crashing local currency

HARARE – Zimbabwe’s finance ministry on Wednesday named 19 companies supplying the government that it said were partly responsible for “price instability and a spiralling exchange rate.”

Finance Minister Mthuli Ncube said investigations by the Financial Intelligence Unit (FIU) revealed that the 19 companies traded large amounts of electronic Zimbabwe dollars on the parallel market soon after getting paid by the government.

Treasury recently froze all payments to contractors until they passed what it termed a “value for money” review.

In a statement, Ncube said: “It has been observed that some contractors after passing through the value for money process and having received their payment from government still tend to siphon their proceeds into the parallel market thereby causing domestic inflationary pressures.

“In this regard, this statement today is to give an update on findings from the work conducted by FIU on monitoring payments made to government suppliers as well as measures to deal with non-compliant contractors with a view to plug parallel market dealing.

“FIU has noted that upon receiving their payments, the companies would engage in spontaneous illegal foreign currency transactions through buying foreign currency from individuals and entities.”

He named the 19 companies as Redan Coupon, Nariox (Pvt) Ltd, New Age Marketers (Pvt )Ltd, Pepwit Investments (Pvt) Ltd, Tirumi Investments (Pvt) Ltd, Mwendo Africa (Pvt) Ltd, Alg World Investments (Pvt) Ltd, Lobmer Investments (Pvt) Ltd, Nisbank Enterprises (Pvt) Ltd, Sailgroom Enterprises, Wayvar Investments, Poweride Safaris, Azelion Energy (Pvt) Ltd, Blackdeck (Pvt) Ltd, Paza Buster (Pvt) Ltd, The Best Car Rental, The Legacy Car Rental, Josam Enterprises (Pvt) Ltd, and Construction Warehouse (Pvt) Ltd.

The Zimbabwe dollar has come under pressure as inflation continues to spiral. The government has scapegoated big companies which it accuses of fuelling trade on the black market, where the United States dollar can fetch up to RTGS$1,000, while the government’s official exchange rate is currently fixed at 635.

The FIU previously froze accounts of several companies including Transerv, Powerspeed Investments, Electrosales, Halsted Brothers Ltd, and Enbee Store after accusing them of fuelling currency losses.

Ncube, in his statement, said the blacklisted 19 companies engaged in transactions unrelated to their business in order to quickly offload their RTGS dollars.

He said: “Some would also purchase fast moving consumer goods from various manufacturers and the goods would then be sold exclusively in foreign currency.

“In view of the above, and in an endeavour to maintain sanity in the foreign currency market and to curb inflation, the government is left with no other option than to blacklist the mentioned companies.”

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