What will new governor of Zimbabwe’s Reserve Bank mean for mobile money?
Friday, March 28, 2014
If you were waiting, the wait is finally over, former CBZ chief and Economist Dr Mangudya will be the new substantive Governor of The Reserve Bank of Zimbabwe. This comes at a time when the government is making deliberate efforts to re-position the Reserve Bank as the engine of Zimbabwe’s economic recovery. The Herald reports that Dr Mangudya will assume his reigns at his new no. 80 Samora Machel Ave offices effective 1 May for what could be the first of two five year terms.
Given the current state of the economy particularly the banking sector, the Dr will have his plate full from day one. Amongst his brand new set of headaches will be mounting debt, a fading economy, depressed spending, a devastated industry, an anguishing banking sector, investor paranoia, mysterious policies and corruption. To make matters worse, unlike his predecessor, this governor will have virtually no control over money supply (perhaps a good thing for the rest of us). What he will likely have, however, is a lot of power, particularly over matters of policy. As our government becomes more desperate to deliver on some incredible election promises, they will be forced to do away with populist policies in favor of economic best practices. For this reason, they will likely give their main banker the space he needs to make his voodoo work, especially after his success at CBZ. Without his signature on any bank notes, I expect that we will witness a governor who will rely more and more on policy to exercise his power over issues that are beyond his immediate control.