IMF Tells Zim What To Do For New Currency To Work

The International Monetary Fund (IMF) said that strengthening the independence of the Reserve Bank of Zimbabwe (RBZ) will go a long way in improving governance and help stakeholders gain confidence in the new currency.

This was said by the IMF Resident Representative for Zimbabwe Patrick Amir Imam in an interview with Business Times.

His remarks follow the announcement made by Finance and Economic Development minister Mthuli Ncube in April that Zimbabwe will have a fully-fledged currency within 12 months. Said, Imam:

Having said all this, strengthening the independence of the RBZ and improving its governance and controls will further help to gain confidence in the new currency.

… Thus, improving the governance and financial autonomy are prerequisites for a more independent central bank to conduct monetary policy, and will help further the stability of the new currency.

Imam added that the country’s currency will either work on not work depending on the existing conditions. He said:

The history of Zimbabwe has shown that a dollarised system can succeed as it did after the hyperinflation period, when the right conditions were in place, or that it can fail, as it did in the past two years when the pre-requisites are lacking.

Similarly, Zimbabwe’s history also illustrates that having one’s own currency can work, as it did after Independence, or fail, as it did in 2008/09, depending on whether the macroeconomic conditions for stability are in place.

More: Business Times

Reserve Bank of ZimbabweMthuli Ncube

The Reserve Bank of Zimbabwe (RBZ) is the central bank of Zimbabwe. Its offices are located at number 80 Samora Machel Avenue in Harare. The Reserve Bank of Zimbabwe operates under the Reserve Bank of Zimbabwe Act, Chapter 22: 15 of 1964. The Act provides... Read More About Reserve Bank of Zimbabwe

Professor Mthuli Ncube is the Minister of Finance and Economic Development.He was the Chief Economist and Vice President of the African Development Bank ,financial, economics, investment, and public policy expert, entrepreneur and academic. Professor Ncube divides his time between the private sector in Switzerland and... Read More About Mthuli Ncube

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