US$500 Million Foreign Exchange Auction allotments in April

Business Reporter

The country’s foreign exchange auction realised total payments of over half a billion for the month of April with raw materials, machinery and equipment taking up the most share as published by the country’s central bank.

According to a press statement released this week by the Reserve Bank of Zimbabwe, highest allotments stood in raw material

smachinery and equipment, retail and distribution, consumables, services, pharmaceuticals and chemicals, packaging and energy products respectively.

According to the RBZ,“The bulk of the auction allotments during the month of April 2022, 68%, was for payment of raw materials (US 55369119) and machinery equipment (US$30688074), with the remaining 32% of the total allotments going towards payment of retail and distribution, (US$10713036), consumables (US$10366460), services US$9133409), pharmaceuticals and chemicals (US$5574526), packaging (US$3 617 236) and fuel, electricity and gas (US$189 604).”

An over 600% variation existed between the main foreign exchange auction which accounted for US$107, 801, 206 and the SME’s market which accounted for US$17,850,257 of total allotments reflective of both the structures support of both industries despite marginal variation.

“A schedule showing the total foreign exchange payments for the period January 2022 to April 2022 by source amounting to US$2,440,874,016 broken down as follows, i. Foreign Currency Accounts (US$1,854,284,195), ii. foreign exchange auction allotments (US$528,126,996) and iii. The interbank market (US$58,462,825) The press statement read.

The months figure, (US$ 572, 733, 888) show a slight decrease in allotments from the March figure of (US$ 610,089,170) Major manufacturing beneficiaries in the main exchange auction system were Blue Ribbon Foods (US$1,998,702) which accounted to 1.9% of total allotments, WindmillPvt Ltd (US$1619,378) 1.5% and National Foods which accounted for 1.4% of total allotments following a (US$1.500.000) allocation.

Notable machinery and equipment allotments can be attributed to Southern Region Trading company which allotted US$500 000, accounting to 0.5% the months total allotments and Barzem Enterprises who allotted US$493,670 in April.

The SME’s market saw just over US30,000 going to the highest 30 allotments awarded to firms like Label Flex, Household Converters, Elengrow investments among other Small to Medium enterprises.

Foreign Currency account payments continue to dominate the Foreign Exchange Auction system, accounting for just over three quarters of payment’s to date followed by Foreign currency auction, 22% and the Interbank market having been allotted 2% respectively.

Close to US$2.5 billion has been allotted this year on the foreign exchange market according to the Reserve Bank’s statement.

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