Africa-Press – Zimbabwe. Zimbabwe has made quarterly token payments exceeding US$100 million to external creditors. The Arrears Clearance Debt Relief and Restructuring Strategy, involving creditors, development partners, and stakeholders, is being led by Dr. Akinwumi Adesina, the President of the African Development Bank, and His Excellency Joachim Chissano, former President of Mozambique.
Zimbabwe has made substantial token payments to various institutions, including over US$60 million to the World Bank, US$36 million to the African Development Bank, over US$5 million to the European Investment Bank, and US$9.6 million to the 16 Paris Club bilateral creditors. Economists view these payments as a demonstration of the government’s commitment to the engagement and re-engagement process, facilitating a reduction in the country’s high country risk.
Commenting on the situation, Development Economist Prosper Chitambara stated that the payments showcase Zimbabwe’s determination to clear arrears and engage with creditors and the international community. ZBC cites him as saying:
It is a demonstration of Zimbabwe’s commitment to clear arrears, it’s also obviously an important of our reengagement with creditors and the international community, it also helps to reduce the high country risk that has been associated with Zimbabwe.
Professor Albert Makochekanwa, Director of the Business School at the University of Zimbabwe, emphasised that while the arrears clearance task is formidable, the government’s commitment to making payments sends positive signals about its intentions and fosters a favourable relationship with external financiers. Makochekanwa said:
The agenda is towards ensuring that the debts are cleared while it may be a mammoth task the fact that there is commitment to pay further sends positive signals about the Government intentions and how they can related with the external financiers and find each other.
Since the establishment of the Structured Dialogue Platform, five meetings have taken place, including a High-Level Debt Resolution Forum. These gatherings serve as forums for Zimbabwe to implement necessary reforms and engage with relevant parties to address the significant debt overhang effectively.
Zimbabwe currently faces a significant debt burden, with debts and arrears amounting to nearly $8.3 billion. These financial obligations are owed to both financial institutions and individuals. The debt is inclusive of approximately $3.5 billion to farmers who were displaced during the land reform program.
In 2018, Zimbabwe intensified its efforts to address the debt situation when Professor Mthuli Ncube assumed the position of Finance Minister. The country cleared its debts and arrears with the International Monetary Fund (IMF) to establish new credit line facilities. However, the IMF stated that Zimbabwe remained ineligible for financial assistance as it had outstanding obligations to various other financial institutions.
For More News And Analysis About Zimbabwe Follow Africa-Press
