As normalisation slowly returns to the country’s economic sector, it is time to revisit and correct some of the sins committed by the Reserve Bank of Zimbabwe (RBZ) when it invaded and garnished individual and companies’ foreign currency accounts (FCAs) in the name of busting sanctions.
Although it may have been justifiable at that time to accept what would normally pass for a criminal act, now that the dust has settled, the RBZ must reimburse those affected.
Bankers’ Association of Zimbabwe president John Mushayavanhu told the Parliamentary Portfolio Committee on Budget, Finance and Investment Promotion on Monday that many companies whose FCAs were garnished are now struggling to operate.
What that basically means is while the RBZ found a solution at that time to sort out its mess, it created another problem now haunting many.
The fact that some companies are now distressed because the money that was supposed to finance their operations was garnished simply means the RBZ must honour its debt and repay companies to pave way for them to operate.
Finance minister Tendai Biti has revealed the RBZ owes local companies and non-governmental organisations $1,1 billion, unilaterally garnished from their FCAs between 2004 and 2008.
In March this year, Biti hoped the new RBZ Restructuring Bill would deal with the matter, saying it was important for the central bank to honour those debts.
“The Bill we are crafting will assist in cleaning the RBZ balance sheet. It is our hope that the RBZ gives back the money it took from those accounts,” he said then.
It is our hope the RBZ has learnt its lesson well that engagement in non-core activities does not pay.
Should the bank be in a position where it is unable to repay the monies in cash, we suggest they consider tax rebates for affected companies as a repayment option.
Given that business seems to have warmed up to this kind of arrangement, then it has to be taken advantage of. But then companies that may be desperate for cash need to be repaid in cash.
Repaying the debts is critical if the central bank is to inject confidence into the financial services sector.
An environment where business and the central bank operate in suspicion against each other does not augur well for the economy.
We, at least, expect the RBZ to be communicating with the affected parties so they are aware of the efforts, if any, being made to pull them out of their financial doldrums.