HARARE (Reuters) – Zimbabwe’s central bank has frozen an account of a Chinese company it accused of manipulating the local currency, which lost ground against the dollar on the black market this week.
The southern African nation reintroduced the Zimbabwe dollar last June, ending a decade of dollarisation, but this resulted in runaway inflation, which economists say reached 520% in December.
Reserve Bank of Zimbabwe (RBZ) governor John Mangudya, in a statement late on Friday, singled out unlisted China Nanchang as a currency manipulator.
Mangudya said the RBZ financial intelligence unit (FIU) had identified Nanchang as a company that had used millions of Zimbabwe dollars to buy greenbacks on the black market, weakening the local unit.
Nanchang is the major contractor for the construction of a dam that is set to supply water to Zimbabwe’s drought-hit second biggest city Bulawayo, among other government contracts.
“The FIU has ordered the freezing of the identified account pending further analysis and is undertaking ongoing surveillance to identify more culprits involved in the parallel market transactions,” Mangudya said.
The central bank did not say if the account was held with RBZ or with another bank.
A spokesman for Nanchang could not immediately be reached for comment.
