Financial Economics and Financial Literacy

Title" Corporate Finance and Financial Development: An Emerging Market Perspective on a Post-Crisis World" Editors: Shame Mugova -Durban University of Technology South Africa Joseph Akande -Namibia University of Science and Technology May you please prepare a topic and abstract only, up to 300 words. You can email your abstract to: mugovas@gmail.com  cc akandeo.joseph@gmail.com Deadline for submission 30 April 2020 None of the content should have been published or under consideration elsewhere. Book series: The book will be published under book series “Contributions to Management Science” (www.springer.com/series/1505) which is indexed in SCOPUS. Book overview This book addresses key issues in corporate finance and explores them from a financial development and financial stability perspectives in emerging markets. Emerging economies are susceptible to rapidly changing financial sectors and products as well as financial upheavals. The global financia...

                                                            There has been debate on whether the fixed exchange rate between bond and the US dollar should continue or the exchange rate should be allowed to freely float. Neither of the two options works because both their effects are the same. The continued use of bond note and RTGS (Real Time Gross Settlement) is not meant to preserve value or avoid catastrophe. The continued use of the local Zimbabwean currency is a time bomb, the authorities are simply trying to delay the inevitable disaster. The amount of RTGS is not a factor which should stop the demonetization  program. If the amount of RTGS is nine billion, at one point it is going to be thirty billion and probably a trillion, currency reforms should not be deterred by the figure. The authorities need to find a way to ...

Price stability contributes to achieving high level of economic activity and employment. Price is a key function in making investment and consumption decisions. Zimbabwe needs a monetary policy which addresses the key issues of price stability to enable economic recovery and growth. The economic solution lies in addressing the currency crisis. A change of monetary system such as implementing dollarization is a possible option to deal with macroeconomic instability and uncertainty.  The stability of inflation and interest rates result from the success of the monetary policy in maintaining price stability. Prices differ across countries mainly due to the differences in the cost of doing business. Zimbabwe has high cost of doing business which significantly influences the level of prices and makes the country’s exports uncompetitive. The country is importing most products therefore any movement in exchange rates such as the strengthening of the South African Rand influence the l...

                                                        Zimbabwe had a change of government in November 2017 which brought optimism that the economy might be guided on a recovery path following depression for several years since the turn of the millennium. Operation restore economy has not been launched and some people have already started to lose faith in the current administration’s ability to turn around the economy whilst some still believe the economy will be revived and grow again. There is no clear economic vision or policies which have been implemented yet by the government. The industry and firms which had closed have not reopened and the economy seems to be still in a dysfunctional state. It is the hope of Zimbabweans that they will one day have a vibrant economy, employment and the dilapidated infrastructure will be rebuilt. The pr...

Follow @ExpBusinessSA Dollarization is a situation where a country uses another currency officially or unofficially as legal tender. There are greater economic benefits to be realised by going for full official dollarization compared to semi-official or unofficial dollarization. Dollarization does not always involve the US dollar as the adopted currency, the euro can be adopted by non-EU members in the same way Zimbabwe can adopt the South African Rand through full official Randrisation. Official dollarization requires to surrender monetary policy to another country and often a country loses seigniorage and an independent monetary policy. If Zimbabwe chooses dollarization by adopting full official randrisation, the country will still export and earn US dollars and use the same US dollars for imports and international obligations. The only difference is that the rand will be the predominant or exclusive legal tender for local transactions. The official randrisation discussed here ...

The purpose of a central bank is to supply operational capital to the country’s banking sector. The primary purpose of a central bank is to promote the stability of a country’s financial system achieve price stability (low and stable inflation) and help manage economic fluctuations.Central banks communicate to the public through economic policy and inflation rate targeting has emerged as the leading framework for monetary policy.  The central bank can lend to the banking sector thereby ensuring that the banking system has sufficient liquidity for companies and individuals to borrow money because the availability of credit has a direct impact on business and consumer spending. It is also the role of the central bank to ensure that there is sufficient liquidity in the economy so that depositors can withdraw their savings. Zimbabwe is currently experiencing difficulties to obtain foreign currency to meet international payments obligations. The difficulties to ...