Zim resists IMF audit of Reserve Bank

| Thursday July 29, 2010 00:00

The Reserve Bank of Zimbabwe (RBZ) is saddled with financial liabilities of more than US$1 billion, incurred during a period of looting and quasi-fiscal activities that propped up the Mugabe regime. The bank was given US$10 million this year to cover its operational costs but complained that the money was inadequate.

Finance Minister Tendai Biti is adamant that a forensic audit of the bank will be a pre-condition for any additional funding. Questions remain over how the US$1 billion in liabilities was incurred. Press reports abound that officials in several syndicates were able to transfer looted money into offshore accounts.

The scandal involving ZANU-PF activist and businessman Temba Mliswa also proved an eye opener. Mliswa somehow swindled the bank of US$12 million and attempts to recover the money were half-hearted. Only a recent spat with police chief Augustine Chihuri resulted in this and other buried crimes being brought to the public notice.

The IMF was in Zimbabwe last month and released a report exposing how the RBZ was deviating from its core business of financial sector and prices stability. 'Without appropriate oversight, the RBZ used the international reserves backing the statutory reserves of banks (US$80 million) and sold shares from its portfolio of securities at the Zimbabwe Stock Exchange (US$38 million) to finance its activities during January 2009 - March 2010,'the IMF said in the report. While many analysts had welcomed the Reserve Bank of Zimbabwe Act, saying it would trim the excessive powers of Gono, the latest developments point to a 'business as usual' culture still prevalent at the institution. Not only is Gono blocking the IMF audit, but external auditors are said to have reported 'serious weaknesses in internal controls and financial reporting, and comprehensive monetary statistics have not been published since early 2008.' - (SW Radio)