13 May 2017

Zimbabwe: Cash Crisis - Biti Rails Against 'Thief' Chinamasa

Former Finance Minister Tendai Biti has launched a savage attack on his successor Patrick Chinamasa, accusing the Zanu PF apparatchik of pillaging the country's banks on government's behalf, in the process fuelling the current cash crisis.

In an interview with NewZimbabwe.com, Biti, now opposition PDP president, labelled Chinamasa a thief who had no business in government corridors but should be serving time at Chikurubi Maximum Prison.

Biti further dismissed recent claims by Reserve Bank of Zimbabwe (RBZ) governor John Mangudya that the major cause of the country's cash crisis was indiscipline among locals.

"The primary cause of the cash crisis is because the central bank has raided RTGS (Real Time Gross Settlement) balances kept at the central bank," Biti said.

"And the unconstitutional position that the government is running an overdraft with the central bank but the central bank is broke, and when this happens, it is in fact raiding people's monies kept at their banks through the RTGS system.

"The money that the reserve bank is lending to government is not the bank's money. The bank is bankrupt. It is depositors' money.

"When depositors go to the banks to get their money, it would no longer be there because Chinamasa has stolen it."

Central bank governor Mangudya has previously attributed the crisis to locals who frequent banks to access scarce cash but start trading it in the thriving black market.

Mangudya has also accused retailers of keeping their daily collections away from formal banks and using it for speculative purposes.

Tendai Biti as finance minister with then RBZ goveror Gideon Gono

He has ruled out any prospects of the country adopting the South African rand as its anchor currency insisting no currency in the world would reduce misbehaving locals' appetite for hard currency.

Meanwhile, Biti took time to marvel at his tenure as finance minister when bank queues were non-existent.

While steering an economy that was reeling from years of recession coupled with runaway inflation, Biti had a comparatively woe-free tenure as exchequer in chief.

He appeared to combine well with one time rival, then RBZ governor Gideon Gono to revive a near decimated banking system that was also reeling from an earlier cash crisis.

Biti attributed the relative stability to his ingenuity as the country's finance minister.

"It's because we managed the economy well; we did not steal people's money which was in the banks. This (bank crisis) is a direct result of Chinamasa's theft. He should be at Chikurubi," Biti said, adding that banks queues will not disappear under Zanu PF rule.

"They will never go away. It's impossible because Zanu PF cannot monetise the huge hole that they have created. In fact, the bank queues are going to increase.

"Now they are stealing exporters' money including the money that is due to tobacco farmers so the gap is going to be bigger and bigger."

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