Forex auction system must be realistic:Ex-Comesa boss

By Stephen Chadenga

Former Common Market for Eastern and Southern Africa (Comesa) business council secretary general and past president of the Zimbabwe National Chamber of Commerce, Trust Chikohora has said government needed to employ a more realistic and transparent foreign currency auction system if the exchange rate system is to be stabilised.

“We have for a long time also been calling for a more transparent and realistic exchange rate on the auction system so that is is really driven by supply and demand,”Chikohora told Radio VOP while commenting on onetFu ort on Zimbabwe presented last week.

“There is need for a true rate which is reflective of the market so that the auction system becomes the predominant market with the parallel market on the peripheral.

“This will to a large extent also help in the long run do away with the parallel market and help the country achieve and exchange rate stability.”

He said current disprortions in the exchange rate system were failing to stabilise the exchange rate, prices and deal with inflation.

The United States dollar (US$) is currently trading at an average $140 officially while on the parallel market it is around $240.

Chikohora also called on government to use the IMF special drawing rights prudently and transparently to improve the country’s economic fortunes.

He also said there was need for government to redouble efforts to implement the anti corruption agenda which he said was a big impediment to taming the economic challenges.

“Corruption is an albatross in the development of the economy,”he said.

He said there was also need for political reforms which as the political actors dialogue (Polad) they have been pushing for long.