EMPOWERMENT Minister Saviour Kasukuwere and Reserve Bank of Zimbabwe governor, Gideon Gono, reached a truce Monday ending their public row over the takeover of foreign-owned banks in line with the country’s economic empowerment legislation.
Said Gono: “The Minister (Kasukuwere) called me earlier this (Monday) morning from Dubai and we spoke at length very cordially and, like the brothers we are, reconciled our positions and agreed we had ‘assisted newspapers to do good business out of our differences’ and that enough was enough.
“We will (now) work things out taking each other’s views on board before we do anything. I am happy with the new way forward and the mode of collaboration we have agreed upon.”
The row between the two was sparked by a government notice issued last week by Kasukuwere ordering foreign banks to reduce shareholding in their Zimbabwe operations to the 49 per cent required by law within a year.
Gono, who was out of the country at the time, appeared totally flummoxed by the move, accused Kasukuwere of over-reaching his mandate and claimed that, having been involved with a failed bank, the Minister was not a “fit and proper” person to be involved in banking matters.
“The fact that the two main proponents of the recent illogical moves have presided over the failure of their two banks before, namely Unibank and Genesis, calls for Solomonic wisdom on the part of Zimbabwe’s population and leadership,” Gono said.
“Ordinarily, anyone who was near a failed bank is not a fit and proper person to deal with banking matters or to ever own, run or talk about the ownership of a bank again until cleared by the central bank; his is a universal practice.”
However, unfazed by the attack, Kasukuwere hit back, reminding Gono that implementation of the indigenisation programme was not his responsibility. He added: “I know some would have wanted to be doing this task, but let’s not turn it into unwarranted personal attacks.
“Discharging national responsibilities require maturity and sober reasoning. We will not fall for the attacks; but will continue to be guided by the rule of law and the necessary transformation of key institutions.”
Kasukuwere says the foreign banks – two British, Barclays and Standard Chartered, and three South African, Stanbic, MBCA and CABS building society – must be “transformed” because they play political games by denying “you (Zimbabweans) funding”.
But Gono, backed by Finance Minister Tendai Biti among others, is urging a cautious approach, arguing that applying the 51 per cent local ownership threshold to banking could destabilise a sensitive and key sector of the country’s struggling economy.
The RBZ chief insists he is not against the indigenisation programme but has reservations over “technical methodologies that seem to be blind to the fact that, as with everything we do in life, the devil is in the details of the implementation.”
He adds that Zimbabweans should not be quick to forget “the way price controls of 2007 were implemented, leading to unintended consequences that gave birth to BACOSSI (Basic Commodity Supply Side Intervention) and fuelled hyperinflation because a lot of money needed to be printed to buy forex with which to entice industry to go back into production.”
Gono is currently in Beijing, China, attending a shareholders meeting of the African Import and Export Bank (Afreximbank) which is being hosted by the Chinese Import-Export Bank.
He said: “Both institutions are key to crucial to financing Zimbabwe’s trade and development needs at a time other development agencies such as the IMF, the World Bank and the African Development Bank are not extending support to the country due to its arrears situation and the sanctions.”
Observers have expressed concern over the row between the pair with Kasukuwere’s adviser Psychology Maziwisa, writing on New Zimbabwe.com this week, saying the two men should "cut the crap" and end the mutually-destructive public dispute.
“Let’s put it this way: even if it terribly dents their personal egos, Gono and Kasukuwere need to find each other, cut the crap and work together for the good of this country. It’s not too much to ask, it’s the least they can do for a country that has endured many years of economic deprivation,” Maziwisa said.
But sources close to Gono said his intervention was aimed at calming nervy investors and bankers. They said, since he is the country’s main sanctions buster, it is understandable Gono should be “upset and blast anyone who appears to be destabilising his and (Finance Minister) Biti’s efforts at resource mobilisation and financial sector stability.”