LIVINGSTONE MARUFU
The new governor of the Reserve Bank of Zimbabwe (RBZ), John Mushayavanhu, on Friday expressed his disbelief in quasi-fiscal operations (QFOs) , Business Times can report.
He made the remarks at the unveiling of his maiden monetary policy statement.
Dr Mushayavanhu added that quantitative easing or money printing would not be permitted while he was in charge of the central bank.
“I don’t believe in quasi fiscal activities. It’s not going to happen under my watch. My mandate as spelt out in the Reserve Bank Act is very clear and I’ve no intention whatsoever to do other people’s jobs.
“I’ll do my job as the central bank Governor as defined in the Act. In that respect, we’ve moved all quasi-fiscal obligations to Treasury in an effort to clean the balance sheet of the central bank,” Dr Mushayavanhu said.
It comes at a time when the central bank has been splurging millions of unbudgeted cash on QFOs pushing up inflation and exchange rate.
The World Bank (WB) and the International Monetary Fund (IMF), two Britton Woods institutions, proposed avoiding all QFOs and unbudgeted spending because they were worried that an expansionary monetary policy would drive up inflation and the value of the dollar.
The WB and the IMF noted that the RBZ had undertaken several projects, even though it has turned over certain QFOs to the Treasury.
