Zimbabwe to present new IMF financing programme by November

Zimbabwe will present a new financing programme to multilateral creditors by November this year after clearing its arrears, and expects to receive its first loan from the International Monetary Fund in nearly two decades, Finance Minister Patrick Chinamasa said yesterday.

Zimbabwe’s foreign debt stands at $8.3 billion, of which $1.8 billion is arrears, but lacks resources to expunge the debt.

Central bank governor last month said that Zimbabwe expects to pay off the arrears by June this year and access a loan from the IMF in the third quarter of this year, which would be the first since 1999.

“We are going to put together the necessary documentation for us to be able to get to a position where the respective boards of the three multilateral institutions can sit down, hopefully around September to November, to adopt and accept our strategy for arrears clearance,” Chinamasa told journalists.

In the meantime, Zimbabwe is finalising a country financing programme, the basis on which it hopes to clear the arrears, said Chinamasa.

“In tandem, as a reciprocation, we should get new finance to support those sectors of the economy that we think if supported will have a transformative impact on our economic recovery. These are primarily agriculture, private sector growth, and parastatal reform,” he said.

Chinamasa said he is optimistic that the IMF board will adopt a report by its team on Zimbabwe, which has said the country had met its targets under the Staff Monitored Programme (SMP).

The IMF team, headed by Domenico Fanizza, said Zimbabwe had met targets and structural benchmarks under a 15-month SMP, an informal agreement between a government and IMF staff to monitor implementation of economic reforms.

The team was in the country in February and March to conduct the final assessment of the SMP together with the Article IV consultations.

“The IMF Board is meeting on the second of May to receive the report of the mission on SMP targets and article IV consultations, which is positive. It is just to receive and not to do anything else,” Chinamasa said.

“Our expectation is that the report is positive. We have already been told about it and we cannot envisage a situation where the board will query the mission with respect to that, so the report will be received well by the board.”- The Source

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