Fischer to leave Bank of Israel for Bank of Zambia

Shock resignation to come as Bank of Israel Governor set to take up new position as head of Bank of Zambia.

March 8, 2012 14:32
2 minute read.
Stanley Fischer at press conference in Jerusalem

Stanley Fischer at press conference in Jerusalem_311. (photo credit: Reuters)


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Bank of Israel Governor Stanley Fischer will hand in his shock resignation in the coming days and take up a new position as head of the Bank of Zambia, sources have told The Jerusalem Roast.

Fischer was born in Zambia, then Northern Rhodesia, in 1943, but left with his family for neighboring Zimbabwe as a teenager. He studied at the London School of Economics from 1962-66, and obtained his Ph.D in economics at MIT in 1969. It was in the US where he established a reputation as one of the world's top economists before becoming Israel's central bank chief in 2005.

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A clause in Fischer's contract allowing him to accept job offers abroad makes his impending resignation possible. This clause is what enabled Fischer to nominate for the position of International Monetary Fund managing director, for which he was eventually ruled ineligible because the rules stipulated that no-one be appointed to the post above the age of 65.

Sources close to Fischer say he is still hurt by the IMF episode, and is driven by a love for the African continent he left behind more than 50 years ago and by a desire to use his expertise to help improve the situation in the world's poorest region.

"Stan loves Israel and is proud of his Jewish heritage, but his heart has always been in southern Africa. He probably has the best collection of Bantu artwork this side of the Zambezi River," the source, who asked not be named, said.

It is understood that Zambian President Michael Sata first approached Fischer in September after firing central bank governor Caleb Fundanga. Sata dismissed Fundanga over a dispute about monetary policy, even though the latter was widely credited with reducing inflation to below 10 percent for the first time in three decades.

Finance Minister Yuval Steinitz is believed to be furious with Fischer's decision. Treasury officials told the Roast that he even canceled his participation in the office's annual Purim party in order to convince Fischer to reverse his decision.

Steinitz has an unlikely ally in the form of Zimbabwean President Robert Mugabe, although the two have different reasons for opposing Fischer's appointment at the Bank of Zambia.

A furious Mugabe reportedly told cabinet officials this week: "Those damned Zambians have done it to us again. It's bad enough that they're conducting a campaign on Britain's behalf to topple my democratic regime. Now they've also beaten us to the punch in the contest for Fischer's services."

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