RESERVE Bank of Zimbabwe governor John Mangudya has improved in the authoritative global central bankers performance indicators and ranking list by American magazine Global Finance as he graduated with a C- in 2021 compared to a D the previous year, the latest edition of the publication says.
Global Finance is an American monthly financial magazine founded and published starting in 1987 by Harvard-trained financial publisher Joseph D. Giarraputo and others.
The Central Banker Report Cards, published annually by Global Finance since 1994, grade central bank governors of 101 key countries and territories, including African states.
In its latest edition titled Central Banker Report Cards 2021: The Art Of Timing, the magazine puts Mangudya broadly in the same class and category as central bankers from Nigeria, Tunisia, Mozambique, Tanzania, Ethiopia, Zambia and Algeria. T
he only A-rated governors in Africa are from Egypt, Morocco and South Africa; Abdellatif Jouahri, Tarek Amer and Lesetja Kganyago respectively. The central bank governor of Mauritania Cheikh El Kebir Moulay Taher had the least rating (D) of all his African counterparts.
Global Finance, with input from analysts, economists and financial industry sources, grades the world’s leading central bankers on a scale of A to F, with A being the highest grade and F the lowest, based on a series of objective and subjective metrics, including the appropriate implementation of monetary policy for the economic conditions of each country.
Latest performance rankings are based on activities from 1 July 2020 to 30 June 2021. A governor must have held office for at least one year in order to receive a letter grade.
In its citation on Zimbabwe and Mangudya’s performance, Global Finance says: “Zimbabwe’s central bank has been revelling over its prudent monetary policy stance that has resulted in year-on-year inflation dropping from 837.5% in July 2020 to 50.2% in August 2021.
“The bank’s monetary policy committee met in August and resolved to stay the course on the current stance, leading to a decision to hold the benchmark rate at 40%. Zimbabwe’s economy is on the road to recovery after years of turmoil, with last two being in recession. Growth is projected at 3.9% in 2021 by the World Bank and 6% by IMF.
“The apex bank also wants commercial banks to help the recovery by encouraging their clients to invest in government securities. The bank has launched a regulatory sandbox framework to encourage innovations in the fintechs and further liberalised the operations of bureau de change to promote financial inclusion.”
This is contrary to the initial report on the issue by Nigerian magazine Business Insider Africa which rated Mangudya last in Africa.
The publication has since pulled down the misleading article. As economies start to grow again, central bankers face the tricky question of when to ease off the gas — or even tap the brake, Global Finance says.
The last year kept central bank governors on high alert, as a global Covid-19 pandemic threatened fiscal, as well as physical health.
Although years of loose money left some with little room to add stimulus, central bankers used all the tools at their disposal to mitigate the immediate threat. Covid-19 has since played a role in a cascade of aftershocks, including a slump in commodities and a collapse in employment. It is even now evolving unpredictable variants.
Yet signs of growth are emerging — albeit uneven and unevenly distributed.
“The pandemic is still underway and high uncertainty persists, making it too early to tell which shocks are transitory and which are permanent,” Alejandro Díaz de León, governor of the Bank of Mexico says.
“Global and local supply chains remain critically affected and may be subject to a profound adjustment process.”
The performance algorithm includes criteria — such as monetary policy, supervision of banks and the financial system, asset purchase and bond sale programmes, accuracy of forecasts, quality of guidance, transparency, independence from political influence, success in meeting specific mandates (which differ from country to country), and reputation at home and internationally — weighted for relative importance. — STAFF WRITER