The central bank cannot effectively discharge its core function as the lender of last resort with a $1,35 billion debt in its books

The central bank cannot effectively discharge its core function as the lender of last resort with a $1,35 billion debt in its books

Zvamaida Murwira Mr Speaker, Sir

The current huge debt overhang at the Reserve Bank of Zimbabwe makes it a high risky customer in the eyes of international financiers, thereby deterring capital inflows and the ability of the bank to effectively implement its monetary policies.

There is need to bring finality to the Reserve Bank of Zimbabwe (Debt Assumption) Bill that has stalled several times through interjections mainly from MDC-T Members of Parliament.

Mr Speaker Sir, the Bill was gazetted on June 6 2014 but some legislators, particularly from the MDC-T and some civic organisations, sought to stall it each time it was brought up for debate.

The RBZ Bill seeks to provide for settlement of certain liabilities incurred by the central bank before December 31 2008 amounting to $1,35 billion.

The argument is that with a clean balance sheet, the central bank will be able to attract international financial capital, and focus on its core business of lender of last resort to banks and strong supervision of the financial sector.

Each time Finance Minister Patrick Chinamasa sought to steer the Bill in the National Assembly during the last quarter of the year, interjections would be brought to the fore as if the Bill, now at committee stage, was being tabled for the first time in the House.

Those who raised issues against the Bill did so despite the fact that they had all the time, including submitting them during a public hearing outreach conducted by the Parliamentary Portfolio Committee on Budget, Finance and Investment chaired by Mutoko South MP Cde David Chapfika (Zanu-PF).

Mr Speaker Sir, it is high time that Minister Chinamasa is allowed to steer the Bill to its logical conclusion.

Whether the Bill is passed with or without amendments is not the issue, but what is worrisome is bringing issues that should have been brought up a long time ago.

It goes without saying that Parliament is guided by regulations and procedures which should religiously be followed by everyone, otherwise it ceases to be an august House.

An opportunity was created to bring the kind of issues that are being raised now.

It is like seeking to close the door when the horse has bolted.

One example of the issues raised was by Tafara/Mabvuku MP Mr James Maridadi (MDC-T), who said the Bill could not proceed before issues raised by people from his constituency were considered.

Mr Maridadi said some of the issues were to block the passage of the Bill.

It was the same with Mutare Central MP Mr Innocent Gonese (MDC-T), who sought leave of the House to present a petition from civic society organisations against the Bill.

The organisations were the Zimbabwe Coalition on Debt and Development, the African Forum and Network on Debt and Development, the Zimbabwe Environmental Law Association and the Zimbabwe Lawyers for Human Rights, National Youth Development Trust and Combined Harare Residents Association.

Although some of their recommendations appeared to make sense they had come a bit late as you, Mr Speaker Sir, as presiding officer, noted in your ruling in dismissing the petition.

The recommendations included a proposal to set up a Public Debt Commission and direct that the central bank liquidate its non-core assets to pay off the debts, among others.

The petition was submitted in terms of Section 149 of the Constitution which provides for the right of every citizen and permanent resident of Zimbabwe to petition Parliament.

What was fatal in their request was to do so during the committee stage, which was way later than is legally permissible.

The Chapfika-led portfolio committee went on a whirlwind tour in September 2014 visiting Mutare, Bulawayo, Gweru and Harare seeking views of the public on the Bill before debate could ensue in Parliament.

The public hearings were advertised extensively in the print media among other methods used to conscientise the people.

In addition, the Bill was posted on Parliament of Zimbabwe’s website requiring members of the public to make submissions on it.

One would have obviously expected these organisations or any other interested person to make use of the said platforms.

For the record, one of the organisations, Zimcodd, indeed participated in these public hearings and one would then need to be forgiven for saying it sought a second bite of the cherry by making the petition.

Mr Speaker Sir, now that you have dismissed the petitions, we expect the Bill to be steered without hindrance.

The petition was not the only hurdle or obstacle placed in the way of Minister Chinamasa as he steered the Bill.

Before the petition MDC-T legislators had stalled debate by raising the point that those that benefited from the central bank’s quasi-fiscal activities should not be allowed to debate or vote on the Bill.

The point fell by the way side after Mr Speaker Sir, in your wisdom, dismissed it as lacking merit.

All these impediments are being put in the way of Minister Chinamasa whose efforts to revive the economy are well documented.

Minister Chinamasa has even gone out of his way to make amendments to the Bill in an effort to accommodate the views of other stakeholders.

The amendments are still to be considered.

Besides, the MDC-T had initially demanded that they be furnished with a list of creditors.

Minister Chinamasa duly did that and the names of the creditors who included individuals and companies now form part of the Bill.

This has not stopped those against the Bill from raising frivolous issues in their bid to throw spanners in the works.

It is in light of this that we implore you, Mr Speaker Sir, to ensure that the Bill is allowed to reach its logical conclusion so that the country, and particularly the central bank, becomes seized with the next challenges.

After all, Minister Chinamasa has always said settlement of claims would be done upon proof of a legitimate claim and has already allayed fears that might exist in the minds of any person.

If the debt is taken over by the Government, the central bank will then effectively discharge its core functions.

Sound monetary policies are a key determinant of capital inflows. Economic agents would like assurances that their money is safe before making concrete investment decisions. The central bank is there to ensure that this much needed financial sector stability prevails.

The current huge debt overhang at the Reserve Bank of Zimbabwe makes it a high risky customer in the eyes of international financiers, thereby deterring capital inflows and the ability of the bank to effectively implement its monetary policies.

It is our hope, Mr Speaker Sir, that the Bill will be expeditiously concluded and allowed to sail through.