By Alois Vinga
THE Reserve Bank of Zimbabwe (RBZ) auction Tuesday closed business for the year after disqualifying 239 bids in a development indicating poor scrutiny by the country’s banks.
A trading update outlining the transactions which took place shows that a total 299 bids were disqualified with 114 and 125 on the main and SME auctions respectively.
Allotments on the Main Auction sustained a bias towards revamping industrial productivity after allotting a total US$15,5 million towards raw materials, machinery and equipment US$9,4 million, consumables US$2,8 million, services US$2,2 million, retail and distribution US$2,6 million, pharmaceuticals and chemicals US$1,3 million.
A total of US$35,1 million was allotted on the platform.
A similar trend took place on the SMEs platform where raw materials were allotted US$2 million, machinery and equipment US$2,3 million, Consumables US$802 046, Services US$575 449, Retail and Distribution US$423 215, Electricity US$32 201, US$328 024, Paper and packaging US$184 728.
A grand total of US$41,7 million was allotted on both platforms with the official exchange rate remaining stable at $108,66 against US$1.
Commenting on the results, economist Persistence Gwanyanya said there is a need for banks to play their part in avoiding suspicious and speculative bids.
“Banks are expected to scrutinise these bids well before they are forwarded to the central bank but the high number of disqualifications shows that some banks are not doing their job. So going forward, the RBZ must work towards strengthening systems to plug such loopholes,” he said.
He also said that the allotments thresholds demonstrate the bank’s efforts to allot foreign currency in line with the resources available.
Gwanyanya expressed optimism that this week’s annual closure while awaiting reopening on the 11th of January 2022 will give the RBZ breathing space to clear the backlogs and take stock of areas which need improvement and strengthening before reopening.