INDUSTRIALISTS yesterday criticised the Reserve Bank of Zimbabwe’s one-size-fits-all policy on foreign currency retention which they say is stifling economic growth.
At the opening day of the Confederation of Zimbabwe Industries (CZI) congress at Troutbeck Inn in Nyanga, the central bank also came under fire for failing to turn up despite confirming that it would attend.
RBZ deputy governor Nicholas Ncube was expected to present a paper on “Laying the foundation policies for revival”. It later emerged that Ncube had left for the United States for the IMF executive board meeting in Washington today.
In a no-holds-barred presentation, PG Industries chief executive Nyasha Zhou spoke about the horrors faced by industrialists. He said the retention of 50% of foreign currency receipts by the central bank was not sustainable, as it would not spur manufacturers to produce more for the export market.
He said there had been a steady decline in throughput from industry while the cost of producing goods continued to soar.
Zhou, who spoke on the topic, “Industry experience and perspective” which put industries’ concerns into perspective, said the margins achieved by industry from exports were thin, hence the 50% retention only enabled them to just survive.
He did not have kind words for RBZ staff who deal with exporters.
“I am not sure whether they understand what happens on the shop floor,” said Zhou. “All exporters are being treated in the same way. It’s like giving pain killers to every patient who walks into hospital.”
He said exporters deserved respect from RBZ staff.
“I am a creator of foreign currency. I work 24 hours a day to create it. When I walk into the Reserve Bank I do not expect to be treated like a slave boy. I deserve respect,” he said.
Zhou attacked disruptions in the production process caused by power outages, the shortage of fuel and high interest rates. He said exporters were failing to meet orders as a result of a very harsh trading environment.
Similar sentiments were expressed by Zimboard chief operating officer, Kurai Matsheza, who lamented bureaucratic redtape in the Zimbabwe Revenue Authority (Zimra) and at the central bank.
Former CZI president and Dairibord chief executive Antony Mandiwanza slammed the RBZ’s absence.
“The absence of the Reserve Bank is a mockery to our economy,” said Mandiwanza.
He suggested that the government and the central bank should identify key export drivers and the way to incentivise them.
Finance minister Herbert Murerwa, in attendance at the congress, promised to take up the issue with the central bank and Zimra.
“The youngsters we have at the RBZ are bright and educated in conventional economics. They are not stupid but there is a need to engage them so that they understand the process.
As minister responsible for both Zimra and the Reserve Bank, I will take the message to them,” he said.
Murerwa said the issue of foreign currency retention thresholds had been the subject of discussions with the IMF.
Close to 250 delegates are attending the CZI congress that ends today.
Also attending is Economic Development minister Rugare Gumbo, Industry and International Trade minister Obert Mpofu, and the consultant in the President’s Office responsible for SMEs, Sithembiso Nyoni.