Mangudya to get five more years, says ED spokesman, in new knock on confidence

RBZ chief John Mangudya (REUTERS/Philimon Bulawayo)

Reserve Bank of Zimbabwe governor John Mangudya will have his term extended when his current term ends next year, presidential spokesman George Charamba has said.

Mangudya took office on May 1, 2014, replacing Gideon Gono, and his current term ends in 2019. A new term would keep him at the bank until 2024. Amid financial turmoil, speculation has grown over recent weeks that he could be replaced.

But Charamba told the Herald newspaper on Thursday that President Emmerson Mnangagwa will in fact extend Mangudya’s term.

“The President is very clear on the Reserve Bank Governor’s tenure and his performance. Not only is he there to stay but the President is about to renew his contract for a second tenure,’’ Charamba is quoted as saying.

Charamba’s remarks are surprising, coming months ahead of the expiry of Mangudya’s term, and may unsettle the currency markets and knock business confidence even further.

Inheriting a bank that was $1.3 billion in debt and damaged by low public confidence after Gono’s chaotic tenure, Mangudya had been expected to pull the bank from the brink and win over the public and the markets.

However, his issuance in 2016 of bond notes, a widely unpopular surrogate currency, dented the bank’s standing even further and will remain the most controversial part of Mangunya’s chequered legacy at RBZ. His pledge to quit if the bond note, which he launched as a purported export incentive, failed, further hurt his credibility.

He has also overseen a period of worsening currency crisis and a collapse in confidence in the financial sector.