IT is regrettable to learn that the Reserve Bank of Zimbabwe (RBZ) is yet to present the 2024 Monetary Policy Statement (MPS), in flagrant defiance of the law.
Monetary policy, according to the International Monetary Fund, is an important document which the central banks use to manage economic fluctuations and achieve price stability, full employment, economic growth, and balance of international payments.
Without this document, it is difficult for the country, businesses and industry to plan.
According to the RBZ Act Chapter 22:15 section 46, the apex bank should present a monetary policy in December and June of each year.
It reads: “In June and December of each year, the governor shall submit to the Minister a policy statement containing:
(a) a description of the monetary policy to be followed by the Bank during the next succeeding six months, and a statement of the reasons for those policies; and
(b) a statement of the principles that the Bank proposes to follow in the implementation of the monetary policy; and
(c) an evaluation of the monetary policy and its implementation for the last preceding six months.”
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However, in violation of both the letter and the law, the central bank has been presenting the MPS in February.
The MPS must be provided after the budget statement in order to uphold the rule of law, constitutionalism, and due process.
Put another way, since the budget statement was released in November, the 2024 monetary policy was meant to be announced in December 2023.
The RBZ governor has not yet delivered the policy as of today, March 8, 2024. It is unacceptable for the central bank to continue doing what it is doing. It is time to hold fiscal and monetary authorities accountable. What type of country have we turned into?
Is Zimbabwe now a jungle where established laws and norms are arbitrarily broken?
We demand that fiscal and monetary authorities uphold constitutionalism and the rule of law.
Interest rates in the economy, such as those on savings accounts, company loans, and mortgages, are influenced by monetary policy. Interest rate fluctuations have an impact on people's purchasing and investing decisions, which in turn has an impact on inflation, employment, and economic growth.
The question we then pose is: How will businesses plan without it?
They are now compelled to speculate, which is unhealthy, particularly given the fragility of our economy.
We urge the authorities to take the appropriate action because the MPS is long overdue.
Otherwise, if this decay keeps up, we run the risk of turning into a lawless banana republic.
