Zim fi­nance min­is­ter sets up a team to con­trol mone­tary pol­icy

Pretoria News - - BUSINESS REPORT - | Bloomberg

ZIM­BAB­WEAN Fi­nance Min­is­ter Mthuli Ncube es­tab­lished a mone­tary pol­icy com­mit­tee (MPC) in his lat­est at­tempt to sta­bilise an econ­omy in free-fall.

The for­mer eco­nomics pro­fes­sor, ap­pointed last year to get the econ­omy out of a two-decade rut, named a nine-mem­ber panel con­sist­ing of aca­demics, bankers and the gover­nor and two deputy gov­er­nors of the na­tion’s cen­tral bank.

The com­mit­tee, first mooted in March, is a step to­ward set­ting a benchmark in­ter­est rate and introducin­g in­fla­tion tar­get­ing as Zim­babwe’s newly in­tro­duced cur­rency plunges and con­sumer prices surge.

Ncube rein­tro­duced the Zim­babwe dol­lar, which the coun­try had aban­doned in 2009, and banned the use of for­eign cur­rency in June. The unit, a pre­cur­sor of which was tied to the US dol­lar at par­ity in Fe­bru­ary, is now trad­ing at 11.99 to the dol­lar.

While Ncube has sus­pended the re­lease of an­nual in­fla­tion statis­tics un­til Fe­bru­ary, econ­o­mists es­ti­mate that the rate is be­tween 230 and 570 per­cent.

The in­tro­duc­tion of the MPC will help pro­vide over­sight of the cen­tral bank, though its man­date re­mains un­clear, said Lloyd Mlotshwa, head of eq­ui­ties at bro­ker­age IH Se­cu­ri­ties in Harare, the cap­i­tal.

“Un­til their terms of ref­er­ence are clar­i­fied, it’s dif­fi­cult to gauge how ef­fec­tive the mone­tary pol­icy com­mit­tee will be,” he said. “For ex­am­ple, if there is a vote on in­ter­est rates, does each mem­ber have one vote? Is the cen­tral bank gover­nor also the chair­per­son of the MPC?”

The MPC mem­bers in­clude Kumbi­rai Kat­sande, a for­mer manag­ing di­rec­tor of Nestlé SA’s Zim­bab­wean unit, and Dou­glas Mu­natsi, the for­mer chief ex­ec­u­tive of ABC Hold­ings, which owns lender BancABC. Also in­cluded are Ed­die Cross, a for­mer op­po­si­tion politician, and Ashok Chakravart­i, an eco­nomics pro­fes­sor at the Univer­sity of Zim­babwe. THE Q(H)UBEKA Trust, which was formed to al­lo­cate funds to sil­i­co­sis-af­fected minework­ers, said yes­ter­day that it had paid out R166.6 mil­lion to 1 626 qual­i­fy­ing ben­e­fi­cia­ries and de­pen­dant claimants since its in­cep­tion in March 2016. The trust was es­tab­lished af­ter a lengthy com­pen­sa­tion bat­tle by lawyers Richard Meeran and Zanele Mbuy­isa, rep­re­sent­ing for­mer minework­ers who had con­tracted sil­i­co­sis as a re­sult of work­ing for var­i­ous mines owned by An­glo Amer­i­can South Africa and An­gloGold Ashanti. “Al­lo­cat­ing pay­ments to those who have been af­fected by this dev­as­tat­ing oc­cu­pa­tional lung dis­ease has been a long and ar­du­ous but hugely re­ward­ing process for the trust,” chair­per­son Dr Sophia Kist­ingCairn­cross said. The trust, es­tab­lished to process the claims of a closed list of 4 365 named claimants who pri­mar­ily live in the Eastern Cape, Free State and Le­sotho, com­pen­sated 481 ben­e­fi­cia­ries with R48.4m be­tween the March 2018 and Fe­bru­ary 2019 fi­nan­cial year. | African News Agency (ANA)

SHAUN JUSA

ZIM­BAB­WEAN Fi­nance Min­is­ter Mthuli Ncube has es­tab­lished a mone­tary pol­icy com­mit­tee (MPC) in his lat­est at­tempt to sta­bilise an econ­omy in free-fall. | Xin­hua

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