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Conrad Mwanawashe  Harare Bureau
THE Finance and Development portfolio committee public hearings on the Reserve Bank of Zimbabwe Debt Assumption Bill start in Mutare today. The committee’s four meetings will be held in Mutare, Bulawayo on Tuesday, Gweru on Wednesday and Harare on Thursday.
Government assumed the RBZ’s $1.2 billion debt which arose when the bank engaged in quasi-fiscal activities during the hyperinflationary era. The central bank failed to perform its core functions, that of banker to government and lender of last resort as it was saddled with the debt.

Finance and Development portfolio committee chairperson David Chapfika said the takeover of the debt by the government would help clean the central bank’s balance sheet.

“The government is taking over the debt that the RBZ was carrying in lieu of the quasi fiscal activities that the bank undertook,” said Chapfika.
“This will impact on the taxpayers and therefore it is important that we involve those people who pay taxes and support the fiscal capacity of government. The meetings will start in Amber Hotel in Mutare.

“The final public hearing will be in Harare on Thursday,” said Chapfika.
He said the assumption of the debt will put pressure on the fiscus.

“It’s important that we inform stakeholders so that they come and air their views. Those who are owed monies by the RBZ can also come and share their views,” said Chapfika.

The Ministry of Finance is currently validating the central bank’s debts.
The assumption of the debt by the government is the first step in the strategic decision to reposition the RBZ.

It’s part of the overarching debt resolution strategy enunciated by the Minister of Finance and Economic Development Patrick Chinamasa in the Mid Term Review Statement.