Reserve Bank of Zimbabwe

History

The bank traces its history to the Bank of Rhodesia and Nyasaland, founded in March 1956, which in turn was the successor to the Central Currency Board. The Reserve Bank has continued to function, and has grown in operations and staff, through a variety of changes in sovereignty and governmental structure in Rhodesia and Zimbabwe. For over 4 decades the RBZ operated from the Reserve Bank Building along Samora Machel Avenue adjacent to First street. In the late 80s a competition was conducted to design the new building and the winning design was by Clinton & Evans and Architects,they went on to design the Reserve Bank of Malawi Building as well. Construction of the new RBZ building began in 1993 and was fully completed in 1997 but was officially opened by President Robert Mugabe on May 31, 1996. The building is the tallest in Zimbabwe standing at a height of 394 feet with 28 floors above ground.

Structure

The Reserve Bank of Zimbabwe Act provides for a Board of Directors and a Governor. The Governor, assisted by three deputy governors, is responsible for the day-to-day administration and operations of the bank. The current Governor is John Panonetsa Mangudya. The Governor and his three deputies are appointed by the president for five-year terms that may be renewed. The Governor also serves as chairman of the board. The board's membership includes the three deputies and a maximum of seven other non-executive directors, intended to represent key sectors of the economy.

Operations

The Reserve Bank's most important role is to create and enact monetary policies. According to the bank's website, as the only producer of Zimbabwe's bank notes and coins, it regulates the amount of money in circulation. However, since a range of foreign currencies is currently in use for domestic transactions, the bank's ability to control money supply is limited. The Reserve Bank also looks after the country's gold and other assets, and serves as an advisor to the government, providing the government with daily banking services. It is also active in promoting financial inclusion policy and is a member of the Alliance for Financial Inclusion.

Relevancy

Due to the unstable economic conditions and failure to control inflation (2008), economists have suggested that the Reserve Bank be abolished. Some economists have suggested that the Reserve Bank of Zimbabwe be reformed. Legislation in 2008 was debated in the lower house of the Zimbabwean parliament with a view to limiting the so-called quasi-fiscal activities of the Reserve Bank.Alliance for Financial Inclusion.

List of Governors of the Reserve Bank of Zimbabwe