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Zimbabwe's Mnangagwa vows not to revert to dollarization

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
Zimbabwe President Emmerson Mnangagwa delivers a speech on stage during a rally at the National Stadium, in the capital Harare, October 25, 2019. (Photo by AFP)

Zimbabwean President, Emmerson Mnangagwa, has firmly ruled out the possibility of reusing the US dollar despite the African country’s new local currency plunging against the greenback.

"No progressive nation can progress without its own currency,” Mnangagwa told his ZANU-PF party members at an annual conference outside the capital Harare on Friday. “However, we have so many among our people, who fight this decision. We will not revert back to a basket of currencies, never, never, never."

Zimbabwe "dollarized" its economy in 2009 by allowing the US dollar and other foreign currencies to be used as legal tender in the country after hyperinflation devalued Zimbabwe's sovereign currency by 61 percent.

Mnangagwa’s government ended dollarization in June, after it banned the use of foreign currencies in local transactions in a bid to defend a fledgling interim sovereign currency, paving the way for the new Zimbabwean dollar and its reintroduction last month.

The decision to end dollarization faced opposition from economists and businesses, who said the move drove hyperinflation and eroded wages as the government had rushed to reintroduce the Zimbabwean dollar without the backing of foreign currency reserves.

Mnangagwa, however, insisted that the reintroduction of a local currency after 10 years of using foreign currencies would lead to economic stability and growth.

Dissidents to be ‘flushed out’

Meanwhile, the Zimbabwean president urged his party members on Friday to be wary of political opponents seeking to divide the party, which is already gripped by factionalism.

"I am aware that our detractors are trying to divide the party by attempting to recruit from within the rank and file of our membership," Mnangagwa said. "Let us remain vigilant, steadfast and loyal to the principles of the party. Wolves, among us in sheep’s clothing, must be flushed out."

Mnangagwa blamed the country's economic hardships on the opposition but said he was unfazed by "attempts by our detractors to derail the course of our reforms and economic recovery."

Exiled former minister and Zanu-PF political commissar, Savious Kasukuwere, announced last week that he was planning to return home and challenge Mnangagwa in the next presidential election in 2023.

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