Govt decision to give RBZ ‘new lease of life’

THE decision by Government to assume the Reserve Bank of Zimbabwe’s (RBZ) debt and recapitalise the institution will help it to play an active role in economic revival efforts, an official has said.
Finance and Economic Development Minister Patrick Chinamasa said last week Government would assume the central bank’s $1,35 billion debt and recapitalise the central bank to the tune of between $150 million and $200 million.

Acting RBZ governor Dr Charity Dhliwayo said at a post budget meeting last week that the decision by Government would give the central bank “a new lease of life.”

“Overally, the role of the RBZ is now being restored and we want to express our appreciation,” said Dr Dhliwayo, who is holding fort since the departure of substantive governor Dr Gideon Gono at the end of November following the expiry of his term.

“The central bank has a big role to play in the economy and we have not been able to play that role in the past. We will now fully participate in the turnaround of the economy.”

The central bank had become virtually redundant since adoption of multi-currencies in 2009.
In the Zimbabwe dollar era, it had at one point become the dominant player in the economy as the country battled a catastrophic economic crisis characterised by hyperinflation.

Due to its inability to print foreign currency, the apex bank has only but watched from the sidelines as a liquidity crisis ravages the economy.

The restoration of the interbank market which the central bank will supervise is expected to help improve the liquidity situation.
With the recent designation of its subsidiary, Fidelity Printers as the only gold buyer and exporter in the country, Dr Dhilwayo said the move would allow the central bank to play a crucial role in enabling the country to benefit from its resources.

Fidelity Printers, she said, commenced refining gold last week.
She said further details on the pricing and operations of the gold buying subsidiary would be made public in the monetary policy due early next year. — New Ziana.