Accessibility links

Breaking News

Threats To Zimbabwe Central Bank Chief As FX Stress Continues

Harare has beefed up security around Reserve Bank Governor Gideon Gono based on reports of threats to his life. The the Sunday Mail said an “armed gang of smartly dressed men” in a sport-utility vehicle showed up on Saturday at Gono’s commercial horticulture operation in Norton, about 40 kilometers west of Harare, demanding to know his whereabouts. The next day fire destroyed crops at the farm.

A Reserve Bank official, speaking on condition of anonymity, said police and security forces were protecting Gono around the clock. Security Minister Didymus Mutasa said threats against Gono were deplorable, adding that anyone who tried to derail the central bank chief's economic turnaround program would be brought to book.

More than 2,000 people have been arrested in the past week for alleged currency violations such as hoarding banknotes and illegally exporting currency.

The currency overhaul Gono announced last week came as a blow to speculators holding large amounts of currency which could become worthless when the period for it to be exchanged for new banknotes runs out August 21. Even ordinary businesses and consumers could sustain heavy losses - so Gono is not that popular now.

Political insiders say Gono could be a target to enemies in high places, because his currency overhaul has disrupted highly profitable operations by officials who abused their access to foreign exchange and scarce commodities. Some of these might see Gono's crash currency reforms as intended to deprive them of the resources they would need to challenge what some perceive as his presidential ambitions.

For a former ZANU-PF insider's view, reporter Blessing Zulu of VOA's Studio 7 for Zimbabwe turned to ex-information minister Jonathan Moyo, today an independent member of parliament, having been cast out of the ruling party in early 2005.

Meanwhile, retailers and transport operators in Bulawayo have continued to increase prices despite the three-week freeze announced by the government. Business people say they cannot hold prices down because suppliers keep charging them more.

Studio 7 correspondent Netsai Mlilo reported from Zimbabwe's second city.

While the July 31 currency devaluation and redenomination, and the ongoing swap of new bills for old have caused problems for businesses, one economist says there is an element of profiteering that justifies consumer complaints and state accusations.

However, University of Zimbabwe Graduate School of Management Director Dennis Nikisi tells Patience Rusere there’s not much the government can do to enforce a price freeze unless it is willing to put police in every wholesale and retail outlet.

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