RBZ, Banks In Crisis Meetings
The Reserve Bank of Zimbabwe (RBZ) and bank executives have been holding a series of crisis meetings in the past few days with the view to finding a lasting solution to the liquidity crunch, reported Business Times.
There are concerns that the chronic liquidity crunch bedevilling the economy can potentially hamper the upcoming summer agricultural season.
Senior officials from the Ministry of Lands, Agriculture, Fisheries, Water and Rural Development, are also part of the meetings.
Speaking to Business Times, Bankers Association of Zimbabwe (BAZ) CEO, Fanwell Mutogo, said the crisis meetings are set to continue this week. He said:
The liquidity situation remains challenging but we are worried more for the farmers as this is the financing period for them.
There are a series of meetings being held among the central bank, banks and Lands, Agriculture, Fisheries, Water and Rural Development ministry and I am sure, we will come up with a solution together.
… Direction is not yet clear on how much money will banks splurge for the new season given the current liquidity challenges.
Recently BAZ president Mehluli Mpofu warned that if the agriculture sector doesn’t perform well, it will affect other sectors of the economy. He said:
The 2022/2023 summer cropping season has already kicked off with irrigated crops already planted and with this liquidity squeeze in the market, the desired agriculture growth will be difficult to achieve.
As an agro-based economy, agriculture performance is key to economic growth hence if the sector doesn’t perform well, this will affect next year’s economic projections.
The Confederation of Zimbabwe Industries president, Kurai Matsheza, also said the liquidity crunch has hindered the funding of agriculture. Matsheza said:
We are in a serious liquidity squeeze as we are failing to get working capital from the banks and with the agriculture funding being delayed the shortages of the raw material will persist in the long run as the farmers should have completed some preparations but they are yet to do so due to the liquidity crunch.
