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Mid-year monetary policy statement
Dr Gideon Gono, Governor Reserve Bank of Zimbabwe
October 01, 2007

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In terms of the Reserve Bank of Zimbabwe Act, the Monetary Policy Statement is issued biannually, in December/January and in June/July of each year. This Statement was postponed after necessary approvals and clearances had been given by the Hon. Minister of Finance to allow the Reserve Bank to take into account the policy dynamics that arose from the 2007 Supplementary Budget issued on 6 September, 2007.

1. Introduction and background

1.1 As many of you are aware, this Monetary Policy Statement is issued, as it must be, in terms of Section 46 of the Reserve Bank of Zimbabwe Act [Chapter 22:15].

1.2 Although the said Section of the Act stipulates that the Governor ought to issue his statement at least in December and June every year, and given that we are now in October, I am pleased to report that appropriate legal dispensation was sought from and granted by the Minister of Finance for this delayed presentation.

1.3 My primary duty as provided in the Act is to guide and promote the economic health of our country by formulating, recommending and implementing, as the case might be, monetary policies that ensure the wellbeing of Zimbabwe and all who work and live in it.

1.4 Hon. Ministers, Legislators, Ladies and Gentlemen, I am also required by law, to proffer advice to the Nation where such advice contributes to the economic wellbeing of the country.

1.5 But, as is the case with all advisors, recipients of my advice are at liberty, without offence or obligation, to accept in full or in part, or differ wholly or in part with such advice depending on particular exigencies prevailing at particular times.

1.6 Therefore, today is no different from similar previous occasions when I have been granted the privilege to speak to the Nation.

1.7 Given the unprecedented challenges we have had to contend with since December 2003, we at the Central Bank have come to know and understand that the formulation and implementation of monetary policy and proffering of advice in a volatile economic situation such as ours is and was never going to be a walk in the park nor a blue-sky affair in which what to do or say is crystal clear and thus obvious at all times!

1.8 To this end therefore, please expect no miracles from me but you can expect sincere and practical advice as well as measures which if embraced by all and implemented, with a sense of urgency, diligence and patience, will for sure signal the revival of our economy.

1.9 Sometimes we have had to engage in the strategy known as "necessary ambiguity but with constructive intent" and ploughed around many obstacles through a continuous process of financial engineering and diplomatic negotiations inorder to achieve results.

1.10 We have also long come to appreciate and understand that as a Nation, we are going through a severe and unusually long winter with very thin clothing covering our bodies.

1.11 Our responsibility as Monetary Authorities therefore is to chart as clear and practical a course of action as possible, as we pass through the darkness of this economically longish and cold spell with the assurance though that spring is definitely on the horizon.

1.12 We remain quite optimistic about our future and I ask you all to share that optimism with us. True, we are experiencing hardships, some self inflicted, others of exogenous origin, at all levels of our existence but let us take comfort from the fact that no winter, no matter how severe, is permanent and no spring ever skips its turn. Having said that, allow me to say a few words about: The Past three (3) Months.

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