Global Finance fetes BoT chief

15Jan 2022
Polycarp Machira
The Guardian
Global Finance fetes BoT chief

​​​​​​​BANK of Tanzania (BoT) Governor, Prof Florens Luoga has been named among ten best performing central bank governors in Africa, thanks to operational reforms over the past year.

​​​​​​​BANK of Tanzania (BoT) Governor, Prof Florens Luoga.

The central banker report cards, published annually by Global Finance since 1994, grade central bank governors of 101 countries and territories, including the European Union, the Eastern Caribbean zone, Central African States, and West African States, all of which have monetary unions.

The magazine provides free country economic reports, where it ranked Prof Luoga the seventh in Africa with a grade score of B- and the third in East Africa, with Morocco’s central bank governor Abdellatif Jouahri featuring among the top 10 best central bankers worldwide.

Central Bank of Egypt Governor Tarek Amer also made the world’s top 10 ranks for 2021, with Mauritania governor Cheikh El Kebir Moulay Taher given the lowest rating (D) in the Africa zone.

Jouahri, the governor of Bank al-Maghrib (Morocco), earned an A grade, the highest distinction awarded by the central banker report cards, for the fourth time in a row, credited with tripling the supply of funds to commercial banks and expanding the range of bonds and securities the apex bank would accept in exchange for refinancing.

Tarek Amer, Egyptian central bank governor, was also rate ‘A’ grade for working to restore Egypt’s macroeconomic stability, crediting BoT for cutting its discount rate for lending to banks, and lowering reserve requirements to provide additional liquidity to banks.

“The central bank said it would provide regulatory flexibility to banks and other financial institutions for loan restructurings to borrowers experiencing financial difficulties due to the coronavirus pandemic. Mobile money operators were allowed to increase their daily transaction limits,” the report noted.

Tanzania’s GDP rose by 5.7 percent in the first quarter of 2021, supported by global demand for gold. GDP grew 7.0 per cent in 2019, projecting a lower growth rate this year and subdued inflation at less than 5.0 percent.

Elsewhere in East Africa, Kenya Central Bank Governor Patrick Njoroge was ranked third in the continent with B+, with the report stating that Kenya’s tea and flower exports resumed late July.

The country’s economic recovery would be driven by growing remittances from workers abroad and a bumper harvest of maize, the governor indicated.

The Kenyan central bank lowered its benchmark lending rate at the onset of the crisis, and also lowered reserve requirements, permitting commercial banks to restructure distressed loans.

Governor John Rwangombwa of Rwanda’s central bank ranked fourth in the continent and second in the region B+ grade as the country responded quickly to address the effects of the coronavirus on its fast-growing economy.

In March/April, the bank cut reserve requirements to ease liquidity constraints, to a record low of 4.5 percent, enabling commercial banks to restructure outstanding loans for borrowers facing temporary cash-flow challenges arising from the pandemic.

The government announced a $52m package for local banks to help support funding for business continuity, while the World Bank provided $14.25m of International Development Association (IDA) credit in immediate funding to the country’s Covid-19 emergency response project, it added.

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