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"The Diaspora Bond Increases Our Debt," Economist Prosper Chitambara

2 years agoMon, 03 Oct 2022 09:05:51 GMT

"The Diaspora Bond Increases Our Debt," Economist Prosper Chitambara

Economic analyst, Prosper Chitambara has said the diaspora bond which was recently proposed by Finance and Economic Development Minister Mthuli Ncube will increase Zimbabwe’s debt.

Ncube told diasporans in New York recently that diasporans investing in the diaspora bond will get a 9% interest rate. He said:

We want to invest back home, so first thing is that we can invest through a diaspora bond. We are about to issue the diaspora bond in the next few months. We will be getting 9% in terms of interest, which is a very attractive bond. What we can also do is to set up a structure where you rather than sending money every month to relatives. The interest yield can be used to look after your parents and significant others in Zimbabwe. Your investments are very safe in Zimbabwe.

Prosper Chitambara said the diaspora bond would only worsen the country’s situation. NewsDay quotes him as saying:

The diaspora bond increases our debt because bond is a debt instrument. Something that could also be of concern is that our huge external arrears could probably discourage some people from participating in this bond. However, it’s good to tap into the diaspora as a way to mobilise resources to finance critical infrastructure and other requirements at home.
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The Reserve Bank of Zimbabwe reported that the southern African nation received a total of US$797 million in diaspora remittance during the first half of 2022.

In his midterm review statement presented in July 2022, minister Mthuli Ncube said Zimbabwe owed about US$12 billion to external creditors.

6 Comments

allen · 2 years ago

ndovanhu vakamboti bond note is an export incentive, ma coins akanzi ndeukudzirira vanhu vasapiwa masweets se change, years later vaiuya nechimwe chi scheme futi chekutora mari.

g · 2 years ago

1bond=1usd ,auction system,interbank,bond coins,gold coins mthuli is doing policy after policy mamboedza atezvara chisiyanai nazvo cde

VYBZ KARTEL · 2 years ago

@Grey, you know nothing. Dai wato svi.na hako matumbu ehuku pane kunyora zvisina basa pano.

g · 2 years ago

had never been in an economics class but let me use the streets language ,Diasporians dnt join this scheme munovharwa gbnmnt raided our used in our accounts by using a statutory where they say 1bond=1usd,,it also introduce cashless scheme using econet to pook smthing from us,,umwe sold th car and stand achinoisa mari muagent line expecting returns thru cashout yakazongomuka yaka freezer merchant line yacho again they raided ppls deposits,munhu akangwara anotenga midziyo low lo achiisa apo for example if u go kunaana Rawson properties wovati ndida residential stand ye10ks vanokutsvagira buy that stand develop it with 15ks used to develop a high density standbu can sake th house at 40ks musatenge mombe dzinorohwa nehosha zvikavharana endai kuma rural district council motenga land moyiita recrectional area even mazoe rdc,zvinba cheap stands movaka macreche,xuls etc

VYBZ KARTEL · 2 years ago

@Grey, you know nothing. Dai wato**** hako matumbu ehuku pane kunyora zvisina basa pano.

Nimrod · 2 years ago

l smell a rat on these diaspora bonds. Poor Zimbabwe is promising to pay a yield of 9%, but ku America hakuna ma bond anobhadhara zvakadaro.Kuda kubvira vanhu mari uku. Beware guys

As I see it · 2 years ago

True, better to send money straight to your relatives than invest in these bonds.

Citizen raPep naChamisa · 2 years ago

Hahaha matanga kuziva nhasi here kuty they don’t care about profit of the nation , but filling their pockets

Economics Student · 2 years ago

Please help🙏 Guys What is the functional difference btwn Finance minister Mthuli Ncube and RBZ Governor John Mangudja?

VYBZ KARTEL · 2 years ago

@Economics Student, please revisit your study material, in particular the following sections :- (1) Fiscal policy, (2) Monetary policy. After carefully studying the two sections, you should be able to come up with the functional differences of the two office bearers. However, while studying the aforementioned sections, pay special attention on how fiscal policies support resource mobilization processes through taxes and borrowing, as well as the policy measures that regulate the financial sector of the economy in terms of the monetary policy of the central bank. Good luck with your studies.

Asalif · 2 years ago

@VYBZ KARTEL, asi uri lecturer weEconomics ? Ndoda uyitise mwana wangu maEKE

Asalif · 2 years ago

@VYBZ KARTEL, you did not tell the student that issuing bonds is another way of borrowing and an investment on the part of the holder - just like TBs, hence a handsome return / interest of 9% to the investor. @Economics Student, I hope you now appreciate that the minister is simply doing is job re: diaspora bonds discussion - and in this instance he does not seem to be superimposing himself as the central bank chief, as your sarcastic statement suggests.

Sub-Ed · 2 years ago

@WILLIAM SONBOY CHINEMBIRI (THE BUSH LAWYER), please gives us your thoughts with regards to the question raised by one @Economics Student i.r.o the functional differences of the two officials. @Sonboy, do you think the responses from @VYBZ & @Asalif are correct/ appropriate and whether you are of the same view with the two ?! Please help the student.