Zimbabwe Government Under Fire For Halting Bank Lending
A move by Zimbabwe to suspend lending by banks will backfire, create a parallel banking system and usurp efforts to fix the moribund economy, the country's captains of commerce warned Monday.
Emmerson Mnangagwa on Saturday ordered banks to stop lending as part of a raft of measures he said were aimed at stabilising the economy.
Mnangagwa said the move would stop speculation against the Zimbabwe dollar and curb a burgeoning parallel market where the local dollar was trading at nearly 400 to the US dollar, more than double last week's official rate.
"The government has suspended banking but banks remain intact," the Zimbabwe National Chamber of Commerce said in a statement.
"This legitimises a parallel banking system with usurious interest rates and no investor would be attr...