Accessibility links

State Media Criticizes Zimbabwe Banks for Closing During Strike - 2003-04-29


In Zimbabwe, the state-owned media are sharply criticizing the country's banks for closing during last week's three-day general strike. The strike was called by the country's labor unions to protest a hefty price hike on fuel. The criticism of the banks comes as thousands of Zimbabweans are spending hours trying to withdraw money from the banks.

The state media charge that the banks are cooperating with the opposition to cripple the economy. The state-owned Sunday Mail says unidentified legal and banking experts are calling on the government to investigate the activities of some financial institutions.

The state-owned Zimbabwe Broadcasting Corporation went further, saying that the country's central bank, the regulating authority of banking institutions, is not being tough enough on the banks. It says the central bank is turning a blind eye to what it calls illegal activities such as changing money at the black market rate, rather than the official rate.

The banks are also being accused of violating the country's Banking Act, which prohibits banking institutions from engaging in undesirable methods of conducting business and requires them to provide depositors with their money any time they want, during banking hours.

Under the Act, the Minister of Finance and Economic Development can withdraw a license from a banking institution found to be in breach of the law.

The Sunday Mail however quotes the vice president of the Bankers Association of Zimbabwe, Jerry Tsodzai, as saying that the banks did not close in support of the strike. Rather he says the banks had to close because most of their employees did not turn up for work.

When banks re-opened on Saturday after the strike, there were unusually long lines of depositors wanting to make withdrawals. The depositors had to wait several hours to get their money, as the banks waited for the central bank to provide them with cash.

The lines grew longer Monday following rumors of a strike on Tuesday. But that strike did not happen.

Zimbabwean depositors have to notify their banks in advance if they want to withdraw large sums of money because the country is experiencing a shortage of bank notes.

The central bank, which is responsible for printing the notes, cannot satisfy demand because it is short of foreign currency to pay for the imported paper the notes are printed on.

Zimbabwe is facing its worst economic crisis since independence 23 years ago and is experiencing severe shortages of basic commodities, as well as fuel. Inflation is at an all time high of 228 percent and unemployment stands at 80 percent and is rising as companies downsize or close down as a result of the harsh economic environment.

XS
SM
MD
LG