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Zimbabwe: Bank Services

Volume 482: debated on Wednesday 5 November 2008

To ask the Secretary of State for International Development what safeguards are in place to ensure that foreign exchange deposited in the Reserve Bank of Zimbabwe by non-governmental organisations is not misappropriated; and if he will make a statement. (232119)

The Department for International Development (DFID) holds all aid funds for Zimbabwe in offshore accounts and we encourage our partners to do the same to prevent pilfering by the Reserve Bank. Under current regulatory rules established by the Reserve Bank, NGOs lodge their funds with commercial banks and not with the Reserve Bank of Zimbabwe (RBZ). We aim to deliver DFID programmes using as little Zimbabwe currency as possible. Increasingly, as the economy declines, the use of foreign currency in Zimbabwe has become easier. Most of our procurement is done in foreign currency in accordance with EC rules and outside Zimbabwe. Goods are imported with tax and customs exemptions.

Where funds have to be expended in local currency, money is transferred to local commercial banks for exchange at the best available rate and in small amounts at a time in order to preserve value. Similarly, some foreign currency payments need to be made from local bank accounts. DFID holds regular discussions with NGOs and other implementing partners to ensure that they are able to operate without interference. No DFID funds are transferred to the Government of Zimbabwe and no payments are made through the Reserve Bank.