Published: 01 July 2025

The Zimbabwean government is facing renewed criticism over its handling of Treasury Bills (TBs), amid allegations of corruption, regulatory manipulation, and financial mismanagement that have raised alarm within the country's economic and financial circles.

Treasury Bills are short-term government debt instruments typically issued with maturities of 91, 182, or 365 days to fund public expenditure. However, recent investigative reports and expert commentary suggest that TBs have been abused by politically connected elites to access foreign currency and profits at the state's expense, contributing to a spike in domestic debt.

One of the most serious concerns has been the alleged issuance of TBs without parliamentary oversight, undermining transparency and accountability. Critics claim this has created a shadow financial system benefitting a select few while destabilising public finances.

In December 2024, the government reportedly struggled to honour maturing TBs owed to local banks, further eroding market confidence.

Speaking at the Zimbabwe National Chamber of Commerce 2025 annual congress held in Victoria Falls last week, banker and financial expert Tawanda Nyambirai warned that the current TB regime is damaging the country's financial credibility.

 "We have had the situation where Treasury Bills come to maturity, and this has resulted in a situation where these bills are discounted at ridiculous rates," Nyambirai said.
 "This is regulatory behaviour that completely erodes confidence in the regulator and in the financial services sector."

Nyambirai slammed the excessive discretion afforded to authorities overseeing the TBs, likening the environment to a "graveyard of capital."

 "Where the regulator has become the accuser, the judge, the executioner, and the undertaker," he added.

While stakeholders have previously blamed the Reserve Bank of Zimbabwe (RBZ) for the issuance and management of these securities, the central bank has distanced itself from the controversy.

RBZ Deputy Governor Innocent Matshe clarified that the central bank no longer plays a role in fiscal operations, including Treasury Bill issuance.

 "The RBZ is no longer going to be involved in any kind of fiscal operation. Fiscal issues will be dealt with by the Treasury," Matshe said.
 "All of these legal debts were moved to the Treasury. The Reserve Bank has no use for these bills."

He acknowledged the central bank's previous involvement in quasi-fiscal activities but said such practices had been halted by the Ministry of Finance, Economic Development and Investment Promotion, which assumed the full burden of public debt.

 "The time when the Reserve Bank is going to be dishing out money is gone. We need to go out there and do it ourselves," Matshe added, urging financial institutions to seek offshore lines of credit instead of relying on state support.

According to Treasury figures, as of September 2024, Treasury Bills on the government's books amounted to US$261 million, while Treasury Bonds stood at US$4.87 billion.

The controversy over TBs underscores deeper concerns about Zimbabwe's fiscal governance, as the country continues to battle debt distress, low investor confidence, and a fragile currency environment.

Economic analysts say resolving the TB issue requires legislative reform, transparent debt management, and stronger oversight to prevent future abuse of public borrowing mechanisms.
- online

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