Industry pushes for further cut in interest rates

Zim Now Writer

Captains of industry have warned that high interest rates have continued to push up the cost of doing business while calling on the Reserve Bank of Zimbabwe to should further slash borrowing costs to about 100% from the current 140%.

This comes as the RBZ reduced interest rates from 150% to 140%.

Zimbabwe National Chamber of Commerce president Mike Kamungeremu said interest rates have remained usurious for businesses.

“We appreciate the central bank’s efforts to reduce interest rates to 140% but we need them to go further down to 100%.

“When the interest rates were reduced to 150%, we recommended RBZ to put it at 100% and that’s the position and we maintain,” Kamungeremu said.

Confederation of Zimbabwe Industries president Kurai Matsheza said: “As an industry, we welcome the decision [to reduce the interest rates]. We hope if the disinflation is sustained, then further reduction is expected sooner rather than later.”

Bankers Association of Zimbabwe president Mehluli Mpofu said while the sector welcomed the rate cut, it was worried that “even at 140%, businesses are not showing interest to borrow ZWL$ at that rate”.

Emmah Mungoni, who is ZB Financial Holdings finance director, said the bank policy rate remained high and needed to be revisited.

“However, we expect the interest rates to be further revised downwards to an average of 80% before year-end,” Mungoni said.

AFC Holdings Strategy and Business Development head Joseph Mverecha said there was no strong case for a 140% interest rate.