People and companies in Zimbabwe hold $1.3 billion in foreign currency accounts, central bank governor John Mangudya said on Monday after the finance minister announced that individuals will be allowed to withdraw their U.S. dollars in cash, APA reports citing Reuters.
Mangudya told a parliament committee that individuals would be allowed to withdraw up to $1,000 a day from their foreign currency accounts without restrictions but that companies would need to talk to their banks if they needed cash dollars.
Zimbabwe made the RTGS dollar, an interim currency introduced in February, its sole legal tender last Monday, ending a decade of dollarization and taking another step toward relaunching the Zimbabwean dollar.
Finance Minister Mthuli Ncube had earlier told the same committee that individuals will be allowed to withdraw U.S. dollars in cash from their foreign currency accounts.
He defended the surprise manner of the announcement and promised that Zimbabwe would not fall into rampant money-printing of the kind that that caused hyperinflation in 2008.
To that end, Zimbabwe will initially print 400 million Zimbabwe dollars, to be gradually introduced into circulation to plug the gap left by the end of dollarization, Mangudya said.
The southern African nation, which was hit by a drought that cut crop harvests, is in the grip of foreign currency and fuel shortages and daily electricity cuts lasting up to 15 hours.