via RBZ can raise its own $1bn: Gono | The Herald February 4, 2015 by Golden Sibanda
FORMER Reserve Bank of Zimbabwe Governor Dr Gideon Gono says the central bank could raise more than $1 billion by disposing of non-core assets to clear its debt, but vehemently dismissed recent claims by a Parliamentary Committee that the debt was overstated.The ex-RBZ chief said discussions on the emotive issue of the RBZ’s debt should take into account assets and security it holds that Government could take and net off with its debts.
Dr Gono’s remarks follow claims by a Parliamentary Committee on Finance and Economic Development that the bank’s debt was grossly inflated.
Commenting in defence of the validity of RBZ’s debt, Dr Gono said he was constrained by banking laws and ethics to discuss in detail bank-client affairs in public or with unauthorised people. However, he said he supported the process to account for every cent.
The former RBZ boss said contractual obligations also did not allow him to comment in detail or with specifics on matters which, generally, a sitting governor was cable of dealing with.
Committee chairperson, Bikita West legislator Dr Munyaradzi Kereke, said figures in the RBZ Debt Management Bill were inflated by up to 2 500 percent and should be audited.
Dr Kereke picked the issue of the Meikles claim, which rose from $34 million in 1998 to $90 million, as the perfect example of one of the creditors who fraudulently inflated their claims.
But Dr Gono, the presiding governor of the apex bank when a significant portion of the debt was contracted, said he was available to explain to Parliament the entire make up of the central bank’s debt profile without risking confusion among key stakeholders.
On the Meikles debt, he said it was to be treated the same way other creditors were and its deposit with the central bank attracted the standard rate at which Government borrows from other entities.
“As is now, emotions are also unnecessarily evoked on such issues as farm mechanisation and some such others. Against the above debt, it is essential to highlight to legislators the other side of the RBZ balance sheet, that is assets . . . the debtors,” he said.
This also comes as Finance and Economic Development Minister Patrick Chinamasa and RBZ Governor Dr John Mangudya appeared before the Parliamentary Committee to explain circumstances around the debt and its proposed takeover by Government.
“Unfortunately, it is unfair for the nation or for the legislators to expect these two fine gentlemen to satisfactorily explain a $1,3 billion debt, the majority of which they were not party to its contraction.
“Both run the risk of being taken to the cleaners by people who want to confuse very simple matters of commerce and turn them into some scandal of sorts for ulterior motives,” he said, adding that what was before the legislators was a “one-legged transaction”.
Dr Gono said it should be noted that the central bank was owed about $1,5 billion by Government, which if paid would have extinguished the bank’s debt burden. The bank also holds assets that could be sold to clear the bulk of the topical RBZ debt.
“How much does or did the Government owe the RBZ and has Government (taxpayer) paid the RBZ what it owes? What is the value of the non-core assets held by RBZ, which today can be auctioned to the highest bidder and raise no less than $1 billion,” Dr Gono said.
“All this and other matters relevant to the RBZ debt takeover can be made available to legislators if they call upon people with the requisite knowledge and are honest and truthful about the RBZ state of affairs than is currently being presented,” the ex-governor said.
He however, said he was not naïve as to expect the Budget and Finance Committee of Parliament to invite him to shed light on the crucial issue of the RBZ’s $1,3 billion debt because his appearance there would make “a few people feel uncomfortable”.
Dr Gono said his erstwhile advisor at the bank, Dr Kereke, risked whipping the tax payers emotions and portraying the image that corrupt leadership was appointed to the helm of the bank when he (Kereke) claimed Government could assume an inflated debt from RBZ.
He said the RBZ debt comprised pre-independence debt, debt accrued between 1980 and 2000 such as from International Monetary Fund, World Bank, African Development Bank, Meikles Limited, Anglo-American, Malaysia and others from 1998-2000. There also is the 2003-2008 and post dollarisation debt in the $1,3 billion figure.
Apart from the principal amounts, which exceeded $500 million when he assumed office in 2003, Dr Gono said attention should also be given to interest components, whether the borrowings where done above board and what the borrowed funds were used for.
Dr Gono said he was not trying to seek relevance or enter Parliament by default, but was trying to assist in a process “that is getting messy at the altar of ignorance and misrepresentation. “Zimbabwe ought to cherish good accounting practices and fair commerce.”
COMMENTS
I have studied the true growth potential of Zimbabwe’s economy and having corelated facts from fictions and earnestly considering the real and substantive methods in Zimbabwe’s control to develop a unique “Zimbabwe grass root” method could, in a short period of time and with strong potential of continuity, create the kind of capital Gov. Gono is speaking of. I had the pleasure of meeting the former RBZ’s Governor Gono during my visit with an American delgation. I was, to say the least, as an American impressed with some of the issues Dr. Gono raised during our conversation. His candid and unbiased conviction of Zimbabwe’s immense wealth in its natural resources that is “yet to be developed and exploited” is the answer to Zimbabwe’s dire economic situation so well designed and enforced by the criminal corporatocracy of the West. Dr. Gono’s on going political character assassination is nothing new to the political whims of Zimbabwe’s fractured political system. A system so deeply laced with West and its henchmen trying to further destablize Zimbabwe for its immense natural wealth that the West has its evil eyes upon it. According to Dr. Gono’s concept of developing a strong economy of Zimbabwe through private sector’s international partnership for a strong mining sector development that can genuinely create not only one bullion but tens or even hundreds of billions of dollars of opportunities. What question comes to my mind is, why Dr. Gono did not continue on his plans to initiate a strong international collaborations of various options of private capital inflow into Zimbabwe? His candor and obvious confidence in this type of “out of the box” thinking does really offer a genuine possibilities of Zimbabwe’s economic propsperity. What is holding Zimbabwe from embarking “Gono Economic Revolution (GER)”? Is is just the politics or something else?
“Unfortunately, it is unfair for the nation or for the legislators to expect these two fine gentlemen to satisfactorily explain a $1,3 billion debt, the majority of which they were not party to its contraction.
“Both run the risk of being taken to the cleaners by people who want to confuse very simple matters of commerce and turn them into some scandal of sorts for ulterior motives,” he said, adding that what was before the legislators was a “one-legged transaction”. This is GONO’s utterance in defence of his GONOMICS in looting and plundering the economy, thus pauperizing the population as it stands today. That man is corruption tainted. Ed Melik I feel sorry for you, for the brain washing you were subjected to by the ex- RBZ supremo. If his quasi-fiscal activities during his reign were above board, the explanations would be plain easy for the two equally useless fellows (Mangudya & Chinamasa) to make.
@Ed Melik, Esq…”Dr. Gono’s on going political character assassination is nothing
new to the political whims of Zimbabwe’s fractured political system. A system so deeply laced with West and its henchmen trying to further destablize Zimbabwe for its immense natural wealth that the West has its evil eyes upon it”. I have with interest read your several comments on this site and find your anti-West sentiments to be nothing more than the tired Zanu puff project. The real enemy in Zimbabwe is the corrupt system of Mugabe and his rogue henchmen. With the vast minerals that you correct allude to where is the money going to in the absence of the West? All Zanoid top brass and few of their runners are living lives far above their income, how so? From the mineral and natural resources which they have privatised for a chosen few. Though it is your right to express your views,your anti West and pro Zanu puff comments are unfortunate and inappropriate for the toiling Zimbos who know who their real enemy is in this instance.
Dear Vapambepfumi… you are correct in assuming that I am critical of my own country’s lack of honor and my government’s illegalities starting from the end of the 1st. world war and till this day continues to shamelessly fanning the fire of racial, cultural and religious wars of the world. In most recent history of our illegal and criminal war against Iraq, Libya, Afghanistan, Somalia, Egypt, Pakistan and others that has destroyed last 60+ plus years of developments of the above named countries only to please Israel. Our West is totally subservient to Israel and its banksters and their media empire. Special interests have systematically torn our last vestiges of one of the world’s most admirable document know as “the American Constitution” only to enable the special interest groups and their corporatocracy turning the shiniest of the shiny beacon of democracy into a fascist police state. We once were the envy of the world but the Zio-Neocons have done their deed and now their eyes are on any country that is weak enough militarily and rich enough in its natural resources, to start creating their economic piracy through self serving so called “economic sanctions”. Zimbabwe was the bread basket of Africa only to be destroyed through illegal economic sanctions based on bogus nonsense. Zimbabwe or its present government does not stand a chance to stand on its own feet less she capitulates to the whims and politically unsound foreign policies of the United States and its lapdogs of EU nations. We have systematically destroyed our industrial and economical base in the USA by transferring this to China, India, Mexico and other countries for bigger and fatter profits for the corporate thugs and now we are facing the music that doesn’t sound too good. Yes, I may sound “anti West” but I love America and every time I see a little bit of America chiseled out bit by bit by the Israeli controlled US Congress and the Senate, I feel angry and disillusioned… bit by bit everyday. And yes I feel for Africa in general and Zimbabwe in particular because I know what lies ahead once Africa allows the sinister fangs of the IMF and the World Bank scorpions to dig in, this will be last nail in the coffin of an already dire socio-economical situation of Zimbabwe. Zimbabweans must take the bull by the horn and with unity fight the evil that awaits on the illusion that somehow once President Mugabe is gone, all will just turn out good! Think again because we know how our West works and obviously the saying goes that the “distant drums sound pleasing” till you get closer. I hope Zimbabwean come to their senses and don’t make things worse by asking for a new but another lame duck figure head of the government only to bury Zimbabwe into a sinister scheme of debts from the IMF and the World Bank. If you must, try reaching out to the non-aligned countries and even BRICS countries!
Mr. Fix it seems to be getting sympathy from Ed Melik why his he not attacking the Chinese for taking most of the mineral wealth not only from Zim but from the rest of Africa the Chinese have ruined africa with their cheap shoddy construction work
Ed Melik should also be attacking China for poaching on a high level on the african continent of the elephant for ivory
Ed Melik is probably trying to get on the right side of the thieving scumbags for his own personal agenda