As the Zimbabwean economy continues on a downward spiral, conducting business in the country has not been getting any easier. There is high unemployment in the country, the cost of conducting business is high and there is low liquidity within the financial sector. The Central bank’s capacity to influence money supply is very limited since it cannot print money any more. Zimbabwe now primarily uses the imported United States dollar for local trade.
The recent announcement by Barclays to withdraw from Zimbabwe had a devastating effect on almost all local financial institutions. Almost everyone is withdrawing their monies from banks. For those unable to withdraw, the trick is to open a new account with a more stable bank, transfer funds and withdraw as soon as possible. The very few employed and banking individuals are now panicking and preferring to keep their monies underneath the pillow as it is deemed safer there.
The situation is so bad to a point where some banks are now refusing to open new accounts and preferring to retain their present clientele base. Which other banks do this in the world? There are now serious money shortage indicators within the formal financial sector. Most banks have already started limiting the maximum withdraw per day. All transactions above US10,000 now require RBZ approval. Most ATMs during the weekends have no money and this is no random coincidence but a deliberate move by banks to try and minimise withdrawals.
From my little experience as a banker and little knowledge as an economics graduate, more “controls” will neither improve the money supply in the economy nor help save or steer our ailing economy in the right direction. Increases in the rates of import duty and imposition of licenses as a deterent to importation result in higher costs of living to the end users. I will not bother to waste neither my time or the readers’ to talk about equitable income and wealth redistribution as a solution.
The only sustainable solution to improving Money supply in our local economy is for the country to adapt a robust import-substitution and exported-oriented growth approach.
In this 21st century also known as the Information Era that we live in, the internet has facilitated the establishment of athriving electronic economy. I strongly believe that Information and Communication Technologies (ICTs) such as ecommerce have a major role to play in bringing in the much needed foreign currency into Zimbabweand Africa at large. More and more people need to start exporting and exploring e-commerce platforms for international trade. The money is out there, somewhere. It is definitely not in the country.
To fully reach out and maximise revenue inflows, there is need for new trade facilitators who can hanness the power of the internet to create alternatives to Paypal. As a resident Zimbabwe citizen, I cannot fully use Paypal. Paypal says Zimbabwe is sanctioned and you cannot integrate it to any of our local banks. We need home grown ICT solutions as Africa. The country needs an online merchant account that understated Africa at large and the opportunities within it.
Whoever is going to be able to provide an e-commerce (online merchant) platform which makes it easy for international, regional and local users to send and receive money online using a mobile number, a bank account and/or email address is going to create potentially the biggest international trade facilitation financial institution in Zimbabwe and potentially Africa at large. I commend the founders of worldremit.com as a user. However, the platform cannot be used as an ecommerce merchant account.
As AVAC Arts I would like to believe that we are amongst the early adapters to use comprehensive e-commerce business platforms for conducting international trade. As the founding member of AVAC Arts I have a passion for art, economic development, information and communication technology and community development . We are hoping to be a practical case study on how communities and the economy can benefit from adaptation and utilisation of new technologies. As users of new technologies in trade facilitation, we also hope to advocate for positive change in business practices and policies towards economic growth and development.