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Ngoni Dapira Business Correspondent
BUSINESS lobby groups have expressed great interest in what the Reserve Bank of Zimbabwe will announce in the Mid-term monetary policy review expected to be announced soon.Although RBZ officials could not confirm the actual date when the Mid-term monetary policy review will be presented according to the RBZ Act, the RBZ Governor, Dr John Mangudya, is required bi-annually in June and December to submit to the Ministry of Finance and Economic Development the Monetary Policy Statement containing a strategy to be followed by the central bank during the subsequent succeeding six months.
Last year, RBZ again failed to meet the June deadline and postponed the MPS to an end of August.
The Bankers’ Association of Zimbabwe president, Mr Sam Malaba, during the Confederation of Zimbabwe Industries congress held last month, said it was very important for the central bank to address banking sector vulnerabilities to restore confidence in the banking sector.
He urged the RBZ to expedite its initiative of a Special Purpose Vehicle to deal with the growing problem of non-performing loans.
“Although Government is making progress regarding addressing banking sector vulnerabilities it is critical to expedite some of these to restore confidence in the banking sector.
“The Government is currently work in progress in respect of capitalisation of RBZ and also working on a Special Purpose Vehicle to deal with the problem of growing NPLs.
“The RBZ has already extended deadlines for capitalisation of banks to allow more time for banks to secure adequate capital.
“The securing of the $100 million Afreximbank facility to kick start the interbank market is also commendable in the capitalisation process of the central bank to undertake the lender of last resort function, which is critical for effective function of the interbank market,” said Mr Malaba.
The banker also said a transparent de-monetisation process of the Zimbabwe dollar would go a long way towards re-establishing confidence in the banking sector.
He also urged the RBZ to conduct wide stakeholder consultations in the de-monetisation process.
CZI past-president and managing director of Nestlé Zimbabwe
Mr Kumbirai Katsande said the currency debate should be addressed, whether the country will adopt the rand
solely or continue with the multi-currency system.
Zimbabwe National Chamber of Commerce Manicaland vice-president and managing director of
Mutare Merchants Mr John Mano said as business they were expecting policies to incentivise confidence for foreign direct investment inflows and cashflows into the country.
“The liquidity crisis is our biggest challenge for business. We need cash inflows into the banks and for the re-capitalisation of key industry to increase production.
“Regulatory measures to promote the cash circulation in the country rather than out through imports should also be implemented,” said Mr Mano.
According to BAZ, in 2013 the bank deposits recorded still remained largely short term with long-term deposits constituting about 16 percent of the total deposits.
Mr Malaba said pressure on the fiscus would continue to decline for the remainder of the year with revenues in decline against a background of increasing company closures.
Several economic analysts concurred that chief on the agenda of the mid-term monetary policy review should be to address banking sector challenges to increase depositors’ confidence in banks, the currency debate, restoration of lender of last resort to the central bank and the issues of non-performing loans.
Online Reporter