FINANCE and Economic Development Minister, Professor Mthuli Ncube, has appointed a nine-member Monetary Policy Committee that will render an advisory role to the Reserve Bank of Zimbabwe (RBZ).
The move is in keeping with global trends where monetary policy committees assist governments in stabilising the economy through devolved decision making in areas such as fixing the benchmark interest rate, monitoring internal and external economic conditions and formulating monetary policy direction among other roles.
Central Bank Governor, Dr John Mangudya, chairs the new committee. Other committee members include prominent businessman Mr Eddie Cross, former Government advisor and academic, Professor Ashok Chakravarti, industrialist Mr Kumbirai Katsande, Mr Douglas Munatsi, Professor Theresa Moyo, Mrs Marjorie Ngwenya and the two RBZ Deputy Governors, Dr Khuphukile Mlambo and Dr Jesiman Chipika.
“In terms of the Reserve Bank of Zimbabwe Act Section 29B, and in consultation with His Excellency, President E.D. Mnangagwa, I am pleased to announce the appointment of a Monetary Policy Committee of the Reserve Bank of Zimbabwe, with effect from 10 September 2019,” said Prof Ncube in a statement.
Commenting on the new committee, economist Dr Gift Mugano commended Government for the decision, which he said should assist the country in developing sound monetary policy fundamentals.
“Basically this committee is like a board for monetary policy that should provide advisory to the monetary authority, in this case the RBZ Governor,” he said.
Central banks in developed economies prefer committee decisions in monetary policy processes as opposed to individual decisions.
Experts believe the model is critical in enhancing transparency and accountability pertaining to monetary policy issues.
The model is also credited for improved monetary policy implementation and communication to stakeholders. Countries such as South Africa, Nigeria, India, Thailand, England and United States also have monetary policy committees.