A cumulative US$ 148 million was allotted to various companies from the Reserve Bank of Zimbabwe-run foreign currency auction system as demand for foreign currency continues to firm.
Since its inception, the foreign currency auction system has been crucial in availing the much needed foreign currency to local companies amid serious currency shortages in the country.
According to the RBZ foreign exchange payments update for the period January to February, the Bank paid US$ 218 million in January and February in Foreign Exchange Auction Allotments bringing the cumulative allotments since inception of the Foreign Exchange Auction System to US$2 814 732 334.
There were 823 beneficiaries of US$120 143 752 allotted under the Main Foreign Exchange Auction during the month of February and 1 897 beneficiaries of US$28 565 721 allotted under the SMEs Foreign Exchange Auction during the same period.
The bulk of the funds allotted at the auction during the month of February 2022 (64%) went towards payment for raw materials (US$54 354 527) and machinery and equipment (US$39 429 531), with the remaining 36% of the total allotments going towards payment for consumables (US$17 217 323), services (US$11 552 570), retail and distribution (US$15 366 912), pharmaceuticals and chemicals (US$6 743 499), packaging (US$3 840 155) and fuel, electricity and gas (US$204 956).
The total foreign exchange auction allotments for January and February 2022 is US$218 351 521.
However, the auction system has been widely criticized for delaying settling payments for winning bidders.
Last week the RBZ Monetary Policy Committee urged the Bank to clear the foreign exchange auction backlog by end of March 2022 and ensure that, going forward, the allotted funds will be equivalent to foreign exchange available during each week of the auction.
