The Reserve Bank of Zimbabwe (RBZ) and bank executives have been holding crisis talks in an attempt to find a long-term solution to Zimbabwe’s current liquidity problems. Everyone is concerned about the upcoming summer agricultural season. Farmers, the government, and other interested parties are worried that the persistent liquidity crunch in the economy will have a big effect on farming, leading to low yields and making the current food crisis even worse.
High-ranking personnel from the Ministries of Lands, Agriculture, Fisheries, Water, and Rural Development have also been attending these sessions. Fanwell Mutogo, CEO of the Bankers Association of Zimbabwe (BAZ), indicated that the conversations will continue this week as all stakeholders seek to find a long-term solution.
The 2022/2023 summer cropping season has already kicked off with irrigated crops already planted and with this liquidity squeeze in the market, the desired agriculture growth will be difficult to achieve.
As an agro-based economy, agriculture performance is key to economic growth hence if the sector doesn’t perform well, this will affect next year’s economic projections.BAZ President Mehluli Mpofu
His sentiments were echoed by CZI president Kurai Matsheza:
We are in a serious liquidity squeeze as we are failing to get working capital from the banks and with the agriculture funding being delayed the shortages of the raw material will persist in the long run as the farmers should have completed some preparations but they are yet to do so due to the liquidity crunch.