Reserve Bank of Zimbabwe (RBZ) governor John Mangudya has denied that the central bank is engaging in any quasi fiscal activities and accused parliamentarians of not understanding what it entails.
Mangudya said this while appearing before the Public Accounts and Budget, Finance and Economic Development Committees on Monday. He was responding to a question posed by Zanu PF Bikita West MP Elias Musakwa who queried how the central bank had accumulated $1 billion loans before demanding a spread sheet detailing how much money was channelled towards public sector investment programmes, recurrent expenditure and stimulating industry.
Mangudya was forced to school the legislators, and defined quasi fiscal activities as “any activity done by the central bank or any other institutions on behalf of the government at a lower market price…As far as we know, we don’t know of any quasi fiscal activities that the Reserve Bank has done from 2014 to date,” he said.
When Mangudya insisted that legislators have a wrong definition of quasi fiscal activities, he pleaded with them to use the international definition.
“My core business is in Section 49 of the RBZ Act, which is to ensure that there is foreign currency. When I give foreign currency to fuel, it is called foreign currency allocation. I think you MPs need a workshop with the RBZ on what quasi fiscal activities are,” Mangudya said, much to the delight of legislators who broke out in laughter.