Govt to settle RBZ FCA debts | The Herald

via Govt to settle RBZ FCA debts | The Herald October 31, 2013 by Rumbidzayi Zinyuke

Government will address the issue of funds taken from various companies’ Foreign Currency Accounts by the Reserve Bank of Zimbabwe at the height of the country’s economic challenges in the 2014 National Budget, Finance Minister Patrick Chinamasa said yesterday.

Speaking at an interactive session with policy makers in Harare yesterday, Minister Chinamasa said these debts and other fiscal debts were now the responsibility of Government and would be addressed adequately.

“All fiscal and quasi-fiscal debts that were accrued by the RBZ have to be cleared, that includes all the money that was taken from the FCAs. Treasury will assume legal responsibility for all those debts so that we can restore confidence in the financial services sector. We need to restore the RBZ’s mandate as a central bank and lender of last resort,” he said.

According to the RBZ, the money was taken to fund critical national obligations at a time the economy was haemorrhaging due to the effects of illegal Western sanctions.

The decision to address the issue comes at a time when the Supreme Court recently awarded a judgment in favour of a Chinese firm, China Shougang International, which was suing Standard Chartered Bank over US$47 739 taken by the RBZ from its FCA.

Central bank officials and those from Standard Chartered Bank will also appear at the High Court, accused of misappropriating an estimated US$500 000 from the Zimbabwe Aids Network which was transferred to the RBZ in 2008. The High Court in June also ordered the central bank to return over US$1 million to Trojan Nickel Mine firm, whose funds were taken through its BancABC                                             account.

Minister Chinamasa said paying off the foreign currency debt was one of the measures that Government was taking to make sure that the economy takes off. He said his ministry was in the process of engaging creditors to verify what the country’s actual debt is and find ways to deal with it.

“In the past we would avoid creditors but now we are engaging them openly and we have told them that while Zimbabwe has no capacity to service those debts, we need new money to help us broaden our tax base and be able to start servicing the debts,” he said.

He said the biggest challenge the country faced was lack of self-confidence which was preventing foreign investors from making a commitment in the country.

He said Zimbabweans were speaking negatively about the country instead of working towards rebuilding the country’s image.

“How do we expect investment if we are speaking badly about the country to possible investors? It is important that we address the issue of country risk which is determined by what we say about ourselves to other people. It can determine investor perception,” he said.

He said the reason why most loans got to the borrower at high rates was because multilateral financial institutions always added 6-7 percent country risk on the loans they gave to local institutions who also had to add their interest.

This, he said, resulted in local people accessing money at 15-30 percent interest. Minister Chinamasa said he would take business people and bankers on most of his ministry’s trips to other countries so that they could forge relationships with investors in those countries and make way for Public Private Partnerships.

He said Government would engage partners for most big projects which needed intensive funding and encouraged the private sector to link up with foreign investors and take up big projects that would be put up for bidding

“Every good project, be it in energy, roads, railways, will be put to PPPs as long as there is a taker and we agree on the terms of the partnerships,” he said.



  • comment-avatar
    Torai hupfumi 10 years ago

    How about 51% do you tell them about it.

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    With what money?

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    Tjingababili 10 years ago


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    masvukupete 10 years ago

    Are the politicians this dull. Some of us have always said as long as the government prioritizes foreign perception over the domestic, the foreigners will forever take advantage of us. It is a lot more important for the government to get American, English, Nigerian, Peruvian election approval than their own people’s approval. Lots and lots of effort is put into making the election look fair to the foreigners when it is simpler just to make it fair for our own people. The government of the day should be a lot more proud to get domestic approval than international approval. Instead our government cherishes international approval and does not give a hoot on Mbuya vangu vari kwa Mazvihwa’s approval. To me that is the fundamental flaw with our political system. If this corrected then everything else will fall into place. The government should be putting all the effort to prove to the doubting Zimbos that our elections (really systems) are as good as they can be. We will market this country like there is no tomorrow if we are all confident of our systems even if we may not like the outcomes of those systems. We need to stop doubting our systems.

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    Mike Nyathi 10 years ago

    will he also pay back the millions whose life savings were wiped out by Zanu’s deliberate fuelling of the hyperinflation?? They must pay the price by rotting in Chikirubi till they die

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    Jrr56 10 years ago

    Talk is cheap. Pay back the money you stole then some might start to have confidence in the country. So far this is a government that says one thing and does exactly the opposite.

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      chazezesa 10 years ago

      uyu murume ndi lawyer and many people doubted that he would be able to make sense out of economic issues. he seems, however, to be doing rather well so far. lets hope that his colleagues will not pull the rug from under his feet. his messages, eg paying back of fcas and positively engaging the business community sends positive vibes to investors. these efforts need to be supported by consistent policy. politicians, especially cabinet ministers, should always be thoroughly briefed on serious matters that affect policy so that they speak with one voice. preferably matters that relate to to fundamental government policy should be left to the official government spokesperson who would issue regular press briefings, or whenever necessary.

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      Hmmm … let them put their money where their mouth is. How long shall we give them? Another 10 years? 15 maybe? They seem to need a VERY long time to sort anything out. The land reform has been over 10 years and is still a big mess. No faith in these liars anymore.