HomeBusinessForex crisis: RBZ targets fuel firms

Forex crisis: RBZ targets fuel firms

BY TATIRA ZWINOIRA

SEVERAL oil firms accused of dabbling into foreign currency  black market activities have ‘confessed’ their transgressions to the Reserve Bank of Zimbabwe (RBZ) after being nailed in a Financial Intelligence Unit (FIU) sting operation, according to central bank governor, John Mangudya.

The firms came under the spotlight following reports last month that cash dealers had been using service stations to swipe for fuel in Zimbabwe dollars in exchange for foreign currency.

United State dollar stocks have depleted on the official market, but oil firms are among the biggest holders of the greenback because they trade in foreign currency.

In an interview with Standardbusiness, Mangudya said rampant parallel market activities were behind price volatilities and rocketing inflation.

However, he was not at liberty to disclose the names of firms involved and the form of punishment.

“We have dealt with them accordingly and most of them have acknowledged that what they were doing was wrong,” Mangudya told Standardbusiness.

“We are quite happy with what we have been doing for the past two weeks.”

To stem parallel market activities in the fuel sector, the ministry of Energy and Power Development wants oil firms to install a special platform called the ‘National Fuel Management System’ (NFMS) at service stations.

The NFMS is a digitised system that will help authorities monitor fuel movements.

“The NFMS will track fuel sales and what currency companies will be used in real time,” a government official said on Friday.

“So far, 50 of these have been rolled out over the past year under a pilot phase to see how the system operates.

“The system was designed by the Harare Institute of Technology.

“This system will address the problem of cash dealers using fuel outlets to change money.

“In coming up with the NFMS, the ministry of Finance and the RBZ were both consulted.

“Government realised that sending officials to do random checks at fuel stations for any impropriety was not working, which is why the NFMS was created.”

Investigations into illegal practices in the fuel sector started last month following reports that oil firms were capitalising on market shortages to illegally trade in foreign currency earned from fuel sales, before channelling it back to fuel imports.

The practice was said to have increased after the foreign currency auction system started struggling to release funds allotted to companies seeking forex on the platform.

Zimbabwean industries, which require about US$40 million per week for their import requirements, have been forced to look for foreign currency on the black market, triggering rocketing demand that has attracted petroleum firms.

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