Zimbabwe businesses can freely set prices after the government ended exchange rate rules. Finance Minister Mthuli Ncube removed limits that kept businesses from charging more than official bank rates. The change makes legal what many shops already did.
This shift aims to fix price problems, as market forces determine exchange rates. Companies had charged between 30 and 32 Zimbabwe dollars per dollar instead of the official 27 rate. Authorities looked away as this practice spread through markets.
The government responded to pressure from business groups that argued restrictions hurt formal businesses. Zimbabwe National Chamber head Christopher Mugaga called it a positive step, saying it helps close gaps between formal businesses and street vendors.
The new law removes penalties for using unofficial rates that most ignore anyway. Economists praise the change as realistic. Research economist Gladys Shumbambiri-Mutsopotsi sees it as a sign of better economic management.
Zimbabwe's currency has stayed stable lately because of a better foreign money supply. Officials hope flexible rates will build consumer trust and attract investors to the formal economy. The focus moves to whether this freedom will help the economy grow.
This shift aims to fix price problems, as market forces determine exchange rates. Companies had charged between 30 and 32 Zimbabwe dollars per dollar instead of the official 27 rate. Authorities looked away as this practice spread through markets.
The government responded to pressure from business groups that argued restrictions hurt formal businesses. Zimbabwe National Chamber head Christopher Mugaga called it a positive step, saying it helps close gaps between formal businesses and street vendors.
The new law removes penalties for using unofficial rates that most ignore anyway. Economists praise the change as realistic. Research economist Gladys Shumbambiri-Mutsopotsi sees it as a sign of better economic management.
Zimbabwe's currency has stayed stable lately because of a better foreign money supply. Officials hope flexible rates will build consumer trust and attract investors to the formal economy. The focus moves to whether this freedom will help the economy grow.
