The government of Zimbabwe is complaining about how exporters are not repatriating foreign currency earned from those exports. The government of Zimbabwe manipulates the official exchange rate to keep it higher. The two points are not just connected they are the same thing. The exporters are not repatriating their foreign exchange earnings because the government of Zimbabwe manipulates the exchange rate upwards.

The Zimbabwean government is the cause of the very thing the Zimbabwean government complains about:

The current bank exchange rates for the RTGS$ today are as follows USD to RTGS$: 4.9516
RTGS$ to RAND: 2.9092
Data according to the Reserve Bank of Zimbabwe Black Market Rates:
USD to RTGS$: 6.95
USD to BOND: 6.75
RTGS$ to RAND: 2.07

That’s it, that’s the problem right there. That’s the cause of this:

Zimbabwe government figures blamed exporters on Monday for exacerbating a dollar shortage

OK, this might well be true:

Treasury official George Guvamatanga pointed the finger at exporters, accusing them of keeping $900 million of their earnings in offshore banks – money that he said should be repatriated to ease the dollar shortages and help stabilise the exchange rate.

Well, why are they doing so?

Because the price on offer to them through the official market is that 40% lower than the real price. And yes, in any conflict between official and black market prices it’s the black ones which are the real, free market, ones. Think about it, why would you, if you could possibly avoid it, transfer money straight into a 40% loss? Hold on to it, hang on, maybe the idiot policy will have changed by the time you get forced to do it. You know, maybe?

Guvamatanga, permanent secretary for ministry of finance said that $500 million out of last year’s $4.3 billion export earnings was still being kept offshore. Another $400 million was outstanding from the January to May 2019 exports, which earned $1.4 billion, he said. Exporters were also keeping $800 million in local foreign currency accounts, he added. “There is $1.7 billion that should be available in this economy to pay for the pharmaceuticals, to pay for the fuel and all the requirements we need as an economy,” Guvamatanga said.

All of that might even be true. But it’s not the economy’s money, is it? It’s not society’s money. It belongs to individuals, to private economic actors. Who show – as we see here – a marked reluctance to take stonking great losses on behalf of society or the economy.

There is, of course, a way out of this. Which is to move to a proper free market in foreign currency. At which point there is no shortage of the stuff. Anyone can buy or sell, either way, we reach the rate at which people are willing to buy or sell either way. That free market price is, by definition, the one at which there is no shortage of foreign exchange. Equally, that we have a shortage of foreign exchange is all the proof we need that we’ve not got a free market exchange rate here.

The problem simply is the continued intervention of the government into the pricing mechanism. Get rid of that and we will have got rid of the problem.