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Mangudya Set to Deliver Monetary Policy Statement

The Reserve Bank of Zimbabwe Governor Dr John Mangudya, is set to deliver the 2018 Monetary Policy Statement (MPS) early February when he returns from Davos, Switzerland where is attending the 48th World Economic Forum. Dr Mangudya, who is part of President Emmerson Mnangagwa’s delegation said he was concluding the MPS with plans to deliver it by the end of the first week of February.

“The MPS as we know is around end of January, but I am here; I am also working on it so that at the end of the day within a week from end of January it will be out,” Dr Mangudya told The Herald Business in an interview here yesterday. “So let’s work with first week of February, if there are any changes, we will advise but we don’t intend to change.”

Dr John Mangudya faces the herculean task of living up to expectations when he delivers his MPS given that it comes hard on the heels of leadership change in Zimbabwe and emphasis on international re-engagement with priority on economics. Commenting on the Davos Trip, Dr Mangudya said Zimbabwe’s agenda at the event was to show the world that it was open for business.

He said the country was looking for investors in all sectors of the economy including agriculture, tourism and mining in order to improve the economic landscape.

“In doing so we are also ensuring that we escalate and move vigorously on the re-engagement, which entails clearance of our arrears to the multilateral institutions and after that as you know we need to clear the arrears of the Paris Club as well and generally improve the international relations between Zimbabwe and the rest of the world,” Dr Mangudya said.

“The best way of doing it therefore is to exchange ideas at critical and important forum like the WEF. Most of the institutions and leaders will be meeting and so far we are happy with the reception we have received and we have discussed with the relevant parties to this equation of improving the ease of doing business,” he added.

The central bank chief said President Mnangagwa’s administration has hit the ground running to improve the investment climate and make the country more attractive to foreign investment.

“The Zimbabwean situation is very simple and the shortage of foreign currency indicates the demand for foreign exchange is higher than the supply and that equation can be resolved by increasing (foreign direct investment) FDI, improving lines of credit and nostro stabilisation. Once you do that you know that when money comes to Zimbabwe it now stays,” he said.

“Without a good economic landscape you know that money will just flow out of Zimbabwe. So definitely, when you open up the economy you make sure there is retention of money that comes into the system.”

Dr Mangudya said Government was inviting large global corporates to set up operations in Zimbabwe to create jobs and generate foreign currency for the economy through exports. He said foreign investors would be guaranteed of repatriation of their dividends through direct support from the central bank under the nostro stabilisation facility.

“For example, Zimbabwe is a big tobacco producing country so we are saying the big companies that manufacture cigarettes can come to set up their manufacturing plants in Zimbabwe and then by so doing you bring capital,” Dr Mangudya said, adding “In the meantime we are making sure we move on the nostro stabilisation facility to give confidence and assurances to those foreign investors who have money in Zimbabwe so that we help them to remit out of the country.”

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