Chinese firm, China Nanchang has been named by Zimbabwe’s central bank as one of the players that are pushing up foreign currency rates by flooding the illegal black market with “millions of dollars”.

This development comes fast on the heels of a warning by the Reserve Bank of Zimbabwe (RBZ) to currency manipulators after the country’s official foreign currency trading rate moved to circa 17.22 to the United States dollar from longstanding levels of around 16 over the past few days.

China Nangchang is a construction company. And last October the company was involved in a tender row after it was awarded a tender e construction of the US$171 million Silverstroom Dam in Mashonaland Central province.

The tender had been won by another Chinese firm, China Jiangxi International and Technical Co-operation Co. Ltd.

Said RBZ Governor Dr John Mangudya this afternoon:

“Earlier today, the Reserve Bank of Zimbabwe issued a statement raising its concern on the illegal activities of foreign exchange rate manipulators who have been engaging in activities that have exerted pressure on the exchange rate in the last few days.

“The Bank escalated the matter to the Financial Intelligence Unit (FIU) for investigation and the FIU has so far identified one entity (China Nanchang), which has used its bank account to inject millions of dollars into the parallel market in the last few days.

“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, particularly on the Ecocash platform.

“The Bank remains focused on its mandate to ensure market stability. To this end, the Bank will work closely with the FIU to identify and take appropriate action, in terms of the law, against any culprits involved in illicit foreign currency activities and manipulation of the foreign exchange rates.”

In similar circumstances last September, the apex bank, ordered all banks to suspend the accounts of four companies on suspicion of money laundering after a significant jump in foreign currency exchange rates.

The four companies included Sakunda Holdings, Croco Motors holdings, Spartan and Access Finance.

The RBZ said it believed that these four companies, which are apparently related, have been involved in an illegal deal of buying foreign currency, which pushed up the foreign currency exchange rates especially on the parallel market.

There has been no update from the central bank on that case.

Last November, the central bank said it was investigating two banks – CBZ Bank and Ecobank – for ‘leakages’ of the new notes and coins. This was shortly after the RBZ had just released new notes and coins as part of measures to ease cash shortages.

The two bank were however found not complicit in illegal currency trading.