Need to capacitate RBZ: Chinamasa

Ngonidzashe Chiutsi Sunday News Correspondent
THE cash strapped Reserve Bank of Zimbabwe (RBZ)’s failure to play its role as the lender of last resort is affecting efforts to revive the economy, Finance and Economic Development Minister Cde Patrick Chinamasa has said.
Speaking in Bulawayo last week Cde Chinamasa said there was a need to capacitate the RBZ so that it could play its role in the recovery of the local economy.

“The best step in restoring the financial service sector is to capitalise the Reserve Bank and make it a lender of  last resort. After that is done it can then play its role as the banker to Government. Currently it is the CBZ which acts as the banker to Government,” said Cde Chinamasa at the Zimbabwe International Trade Fair (ZITF) business conference.

“If we don’t have a functional financial system which is the blood stream of the economy, taking off oxygen to the various sectors of the economy, then there is no meaningful growth in our economy. At the moment there is no lending in the productive sector and because of that current situation, there is no economy,” said the minister.

Cde Chinamasa said he was working tirelessly in enticing business people to come and invest in the financial sector and offer lines of credit to the productive sector.

“I have been doing a lot of work to entice our businesses to invest into our banking sector. Our indigenous banks; most of them are teetering. We want to see money being channelled to the productive sector at competitive rates and currently that is not happening,” he said.

“One local bank was running US$800 million lines of credit annually and now it’s running a paltry US$40 million,” he said.

Cde Chinamasa said the economy was in a deplorable state, a situation that had been compounded as failure by the country to borrow from the international financial institutions such as the International Monetary Fund (IMF) and individual countries as Zimbabwe owed them billions of dollars.

“No one wants to lend Zimbabwe money anymore because we have defaulted in the past. Whether we go to Zambia or Malawi it’s the same thing because we are indebted to these countries. We are on our own and we have to be more innovative,” said Cde Chinamasa.