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Pressure Mounts for Reserve Bank of Zimbabwe Governor Gono to Resign Post

Political sources said Gono has come under mounting pressure from some in the former ruling ZANU-PF party to step down after blasting Harare's indigenization and black empowerment program as a form of cronyism

Pressure on Reserve Bank of Zimbabwe Governor Gideon Gono to resign mounted on Tuesday following a recommendation from the International Monetary Fund that the country strengthen central bank governance and sniping from former allies in ZANU-PF over Gono's criticism of the party's indigenization initiative.

Upon concluding so-called Article IV Consultations with the Harare government this week, the IMF called for improved central bank governance, warning that risk is on the rise in Zimbabwe's financial system. The IMF recommended the establishment of an RBZ governing board and downsizing of bank operations and staff.

Political sources said Gono, who has presided over the collapse of his institution to the point where its assets are being auctioned off to satisfy creditors, has come under mounting pressure from some in ZANU-PF to step down after blasting Harare's indigenization and black empowerment program as a form of cronyism.

One top ZANU-PF official told VOA that Mr.Gono must go, calling him "a buffoon who practices Road Port economics," a reference to the Road Port Bus Terminal in Harare where Reserve Bank Officials were formerly said to have engaged in huge foreign exchange deals that fueled the country's recent hyperinflationary episode.

Sources said South African President Jacob Zuma, who met with Gono while conducted a round of mediation of differences within Harare's unity government last week, urged the central bank to consider stepping down in the national interest. The Movement for Democratic Change formation headed by Prime Minister Morgan Tsvangirai has long been calling for Mr.Gono’s departure.

Gono’s powers could soon be curtailed in any case by central bank reform legislation that awaits the signature of President Robert Mugabe. The bill includes language granting Gono immunity from prosecution for actions taken in good faith on instructions from above, such as improperly funding government operations.

Economic Planning Minister Elton Mangoma, who took part in the IMF policy review, confirmed that the IMF is particularly concerned about RBZ governance.

Peakford Management Consultancy Chief Executive Officer Albert Mandizvidza told VOA Studio 7 reporter Blessing Zulu central bank reform is long overdue.