RBZ boss designate hits ground running

JOHN Mushayavanhu, the incoming governor of the Reserve Bank of Zimbabwe (RBZ), has already started  contributing to the 2024 monetary policy statement (MPS), getting things going right away, Standardbusiness can reveal.

The outgoing RBZ governor John Mangudya will finish his term of office on April 30.

Mushayavanhu's participation in  the crafting of the new MPS to be released towards the end of this month was revealed by Mangudya in an interview with this publication.

"We are working together. It is always like that.

"In fact, what his Excellency (President Emmerson Mnangagwa) did (to announce a new governor) was very good so that at least there is this flawless way of doing business," Mangudya said.

"So, we are working together so that he also understands where things are going and so that we hear his views. At the end of the day, the economy is one. It's for everyone."

He said contributions to the MPS were a product of collective efforts from the competent staff of the bank, various contributions from stakeholders and the market.

"Mangudya does not believe in personalising institutions, including the bank," Mangudya said.

"That's the legacy that I would like to leave at RBZ is financial system stability and price stability through stabilising the exchange rate in order to contain the exchange rate pass-through into the domestic prices."

Mushayavanhu's main task will be to tame the runaway exchange rate as the local currency depreciated by over 90% year-to-date owing to the government increasing its expenditure for the 2024 fiscal year.

The depreciation can be seen in the local currency trading at $6 104,72 to the greenback on December 31, 2023, which has since depreciated to US$1:$12 313, 0448 as of last Thursday.

Mangudya said it was a positive thing that the new governor was coming from the market.

Mushayavanhu had been serving as the group chief executive officer of FBC Holdings Limited prior to his appointment as the new RBZ chief wherein he oversaw many innovations and steered the financial company through many economic challenges.

"We are doing this as seamlessly  and flawlessly as much as possible.

"You all know that the Reserve Bank is the central bank of Zimbabwe? It is not the Reserve Bank of Mangudya or the Reserve Bank of John Mangudya," Mangudya said.

"You also know that as the governor or any other governor, we are bound by the Reserve Bank Act which gives us the mandate of the central bank, (to ensure) price stability, exchange rate stability, and also financial system stability."

He said they improved in terms of financial system stability, inclusion of the unbanked, expanding banking systems, and strengthening its anti-money laundering systems, leaving only exchange rate stability.

"We are taking all the raw materials (suggestions for stabilising the exchange rate) into consideration and come up with what we believe are durable and sustainable policy measures going forward," Mangudya said.

"This is to ensure that going forward, those things won't be things of the past.

"So, we have taken all the contributions from abroad, from what the minister (Finance minister Mthuli Ncube) said, what we have been talking about today, and also, we have received a lot of feedback and input from the market."

To restore value to the Zimbabwe dollar, the authorities want to back it with commodities.