New Board To drive Operations At RBZ

Addressing journalists in Harare, Biti called for a “paradigm shift” at the Reserve Bank of Zimbabwe (RBZ) that is accused by critics of straying from its monetary policy management duties to engage in quasi-fiscal activities many of them meant to prop-up President Robert Mugabe and his ZANU PF party’s waning popularity.

Biti said the board that includes former RBZ governor Kembo Moyana was expected to act urgently to restore viability to the central bank which is facing more than one billion dollars in lawsuits from creditors and various other aggrieved parties.

“We have appointed a board that in our view is second to none,” Biti said.

“There is a huge task at the bank. This board is expected to restore viability. In terms of the bank’s stock of debt is about (US) 1.2 billion dollars.”

RBZ governor Gideon Gono is accused of exacerbating Zimbabwe’s economic crisis over the past decade by ceaselessly printing money to fund Mugabe’s political programmes, including – according to some accounts – paying for the veteran leader’s violent campaign to retain the presidency in a bloody second round presidential election in June 2008.

Gono is accused of illegally seizing millions of dollars in hard currency belonging to NGOs, including more than US$7 million that belonged to the Global Fund to Fight AIDS, Tuberculosis and Malaria that the RBZ was holding in trust and which the RBZ chief used to fund Mugabe’s government. The central bank has since repaid the money.

Biti, from Prime Minister Morgan Tsvangirai’s MDC party that joined ZANU F in a unity government last year, said the new board was expected to ensure the RBZ acts according to the law.

“There is a paradigm shift. We will stick to the law. The era when a minister would say please buy me a car or tractor (to the central bank) is over,” he said.

However Gono, who the MDC wants dismissed from the RBZ, will chair the new board. He will be deputised by former finance ministry permanent secretary Charles Kuwaza.

Other board members include Lawyer Mordecai Mahlangu, Dr Daniel Ndlela, Dr Godfrey Kanyenze, Nyasha Zhou and retired High Court judge, George Smith.

Western governments and the IMF have – among other issues — called for comprehensive reforms at the RBZ before they can provide financial support to the Zimbabwe’s coalition government.