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Central Bank Extends FX Swap Deadline for Rural Dwellers

Bowing to pressure, Reserve Bank of Zimbabwe Governor Gideon Gono announced Friday that he was extending a deadline for the conversion of currency for those living in the country's rural areas. He told a Harare audience that exchanges of old currency for new would resume for rural dwellers on Monday and continue through Saturday.

He disclosed that some Z$10 trillion in the old currency remains unaccounted for with only Z$35 trillion out of Z$45 trillion formerly in circulation converted into new money.

Gono said the currency not presented for exchange represented 22% of Zimbabwe's cash in circulation and had been ‘’trapped into the wilderness of underground markets either inside the country or doing some overtime outside our borders.” Gono warned "major cash movers" including wholesalers and supermarkets that the central bank would "clamp down on those who are bent on fueling the parallel market."

Gono had vowed not to extend the deadline past Monday, August 21st. But he said legislators, provincial governors, traditional chiefs and others brought to his attention the hardship this imposed on rural inhabitants without ready access to banks.

Human rights groups raised concerns about how the exchange was conducted, and members of the public complained of harassment and outright theft by state security agents and ruling party youth militia manning roadblocks across Zimbabwe.

The central bank governor apologized for such incidents.

Reporter Blessing Zulu of VOA's Studio 7 for Zimbabwe asked economist Godfrey Kanyenze, director of the Labor and Economic Development Research Institute for his perspective on the extension of the deadline for those living outside the cities.

More reports from VOA's Studio 7 for Zimbabwe...