Gono livid about $1.3b RBZ debt kerfuffle

via Gono livid about $1.3b RBZ debt kerfuffle 21/09/2014

DAGGERS have been drawn between former central bank governor Gideon Gono and David Chapfika over the proposed US$1.3 billion debt assumption by Treasury amid claims the Zanu PF MP is out to settle old scores with the ex-central bank chief.

Chapfika, who chairs parliament’s finance and development committee, is currently on a countrywide tour to solicit the public’s views on the Reserve Bank of Zimbabwe (RBZ) Debt Assumption Bill.

The law, if passed, will relieve the troubled central bank of the burden of repaying the debt which surged when Gono introduced his disastrous quasi-fiscal policies at the height of Zimbabwe’s economic crisis.

The hearings have however become platforms for citizens to vent their anger against Gono who insists he acted with the full blessings of his principal President Robert Mugabe.

Sources close to the former central bank chief said he was livid about the real objectives of the public hearings which he says have opened him up to ridicule and attack as his political enemies take a go at him.

“The normal procedure is that once the Cabinet Committee on Legislation has passed and recommended to full cabinet and once the full cabinet has approved the draft law, Zanu PF MPs are expected to support the proposals and ensure passage as Law.

“No other law or debt takeover has been subjected to this kind of mischief which is seemingly aimed at rubbishing both Cabinet wisdom and the former RBZ boss.

“The government has taken up the debts of various parastatals without Parliament asking the views of the public and the former governor wonders why the RBZ debt case was being treated differently.”

The government has in the past inherited huge debts owed by struggling parastatals, among them Air Zimbabwe, the Grain Marketing Board, the National Railways of Zimbabwe and the Zimbabwe Electricity Supply Authority without batting an eyelid.

The source said Gono sees the current interviews as a way of putting his leadership boobs at RBZ back into the spotlight while he is still in the process of securing the Zanu PF nomination for the Buhera senatorial seat left vacant by the death of former politburo member Kumbirai Kangai.

Chapfika’s committee also comprises Zanu PF Bikita West MP, Munyaradzi Kereke, Gono’s former ally who has now turned into his bitterest rival.

On the other hand, Chapfika himself has also in the past crossed swords with Gono after the latter fiercely resisted the indigenisation of the financial sector. The two also clashed over the controversial ZimPlats deal.

Chapfika was at the time the chairman of the National Indigenisation and Economic Empowerment, a powerful group whose mandate was to drive the seizure of foreign-owned firms in the country.

Chapfika, who was the deputy finance minister, also saw his UniBank collapse after Gono introduced a raft of tough measures in the financial sector.

Contacted for comment, Chapfika was at pains to deny he was out to get back at Gono insisting he was well within his mandate as finance committee chairman.

He said the public hearings had good intentions and were aimed at allowing the RBZ to revert back to its core functions, most importantly, as the lender of last resort.

“We are capacitating the entire banking sector to be able to lend to financial institutions overnight if they are short and also to collect any surplus monies lying idle overnight, we are actually stabilising the entire market,” Chapfika said, adding that he was in good books with Gono.

“I am doing this in my capacity as chairman and it’s not only me who is doing these public hearings … l just happen to be the chairman. If l am not there somebody else will take over those responsibilities.”