No tools to mend Zimbabwe’s economy say central bank boss

via No tools to mend economy, RBZ boss 07/05/2014 by AFP in NewZimbabwe

THE country’s new central bank chief on Wednesday said Zimbabwe’s economy was weakening and the bank did not have the tools to fix it.

In his first statement since assuming the role Reserve Bank governor on May 1, John Mangudya said the past three years had been tough for the economy and for many Zimbabweans.

“The economy is weaker and the financial system is depressed,” he said, admitting that the “Reserve Bank has no tools at the moment to influence the economy.”

Zimbabwe is saddled with high unemployment levels and a dearth of foreign investment.

Many companies have shuttered and those still operating are often unable to pay each other for services or meet loan commitments to banks. At the same time the tax base is narrowing and tax revenues plummeting.

“The lack of liquidity and its limited circulation within the economy remains the biggest challenge that the Zimbabwe economy is facing,” he said urging private companies and state institutions to boost exports.

Frozen out of foreign debt markets and plagued by years of political crises and international sanctions, Zimbabwe faces what the central bank recently labelled a “severe and persistent liquidity crunch”.

The country had hoped that China and other allies might come forward with financial assistance, but that has not happened.

Zimbabwe does not have its own currency, having ditched the local dollar in 2009 for multiple foreign currencies, including the US dollar and South African rand, after a prolonged period of hyper-inflation.

Starting from a low base, Zimbabwe’s headline growth figures look healthy, although the government’s projections of six percent expansion in 2014 are disputed by the World Bank, which predicts three percent.

Amid the renewed economic troubles, there have been glimpses of a softening tone from veteran President Robert Mugabe. Last month, he tried to convince foreign investors that his government’s efforts to seize white-owned farms did not make the country a risky place to invest.

Mangudya urged greater discipline.
“Discipline to refrain from living beyond our means as this would bring greed and corruption,” he said.



  • comment-avatar
    mandy 9 years ago

    If there is nothing that the Reserve Bank can do about the economy then why did John Mangudya accept the post in the first place? Is it for the perks or for the status? How did you get there? Surely during the selection process some one must asked what this gentleman can do for his country. May be he is just a political appointee on whom a pistol was held to his head to accept the position.
    Zimbabweans we are in trouble really. John Mangudya accepts that he is clueless just every other Zanupf activist. I am disappointed by this level of mediocrity.

  • comment-avatar
    John Thomas 9 years ago

    Mangudya is a tool. A pretty useless tool, but a tool nonetheless. He will fix nothing.

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    roving ambassador. 9 years ago

    He has failed the Zanu test, his job is to tell all that all is fine and there is no room for failure.

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      The man is saying “I will take the pay for my position,but I can not try do anything to correct the situation as it is impossible” Fire the clown now.

  • comment-avatar
    Rwendo 9 years ago

    The primary “tools” the last governor had for tackling problems that were political in nature were printing presses for the Zim dollar and an ever expanding raft of “non-core” activities.

    So far so good. The question is whether he is calling for political solutions; or if he is suggesting that the RBZ can offer solutions if he is given certain “tools” by government.

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    Chaka 9 years ago

    Paid for doing nothing

  • comment-avatar
    Mlimo 9 years ago

    Well he could suggest Mugabe retire and the cabinet resign that’s a start so he can’t say he hasn’t got a mouth and I presume he can read. Someone just point him to this website and he, ll learn a lot if he’s willing and capable of learning. So really he can’t say he hasn’t got the tools. It’s wether he’s got the guts to say it.

  • comment-avatar

    Epic Fail.
    Now here is a man with the easiest job….All he has to do is sit back and watch the economy slide into oblivion…

    His Boss Im sure will pay an epic salary and bonuses to retain his “service”.They dont want to lose his wonderful brains to another country like Laos for example!!

    How charming

  • comment-avatar

    These clowns could not run a bath let alone an economy

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    ownzim 9 years ago

    So typical. We are not surprised. Clueless. He’s got one tool at his disposal, a pen to write his resignation. Dumb.

  • comment-avatar
    Jono Austin 9 years ago

    ‘Failure is not an option’

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    He sounds like a pilot in the lost Malasyian plane. No plan! Lost control.

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    ngororombe 9 years ago

    This man accepted the post well aware of the challenges he was supposed to work thru, now he is saying he has lost the campus, don’t fool us, if he can’t say a way forward he should just resign or else he is dinning with the thieves.

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    protestor 9 years ago

    He is just a ceremonial Governor i guess of all the Governors hes the luckiest one just watching the economy take a freefall

  • comment-avatar

    thats 1 honest dude there

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    Petal 9 years ago

    There are no tools to fix the scum bags theiving brains!

  • comment-avatar
    Mothusi Letsatsi 9 years ago

    Come on guys just give this man some slack. Did you want him to lie? Could any of us have done anything different? His predecessor claimed to be some Messiah. We all know where that led. This humble and honest servant of our country has started well by admitting his challenges. Can we all help by offering some advice?