Finance Minister Patrick Chinamasa says Zimbabweans need to speak with one voice to restore confidence in the country but the problem is that they are very good at bad mouthing their own country, its policies and themselves.
Responding to a question in Parliament from Movement for Democratic Change legislator Eddie Cross about what the country was doing to restore confidence with the International Monetary Fund which is in the country to help with economic recovery, Chinamasa said it was important that Zimbabweans work as a united people and speak well about themselves, not only about their country, but about themselves.
“With Zimbabweans, you can count and this you do not find in other nationalities. If a visitor comes to Zimbabwe and says Zimbabwean people are nice and peaceful, I can bet you, you can find a Zimbabwean who will say, no, they are not,” he said. “Now, that is not good. It is not good for our image and for us.”
Chinamasa said Zimbabweans should also learn to pay back what they owe. The country was in trouble at the moment because it owed $4 billion in debt arrears.
Zimbabwe and the IMF have agreed on a Staff-Monitored Programme to try to get Zimbabwe to pay back some its arrears so that it can get new loans.
Chinamasa said the IMF was insisting that Zimbabwe should amend its mining laws to enable greater transparency in the sale of minerals.
It also wanted the government to reduce its skewed spending where 70 percent of the revenue is going towards wages to about 30 percent.
Below is Chinamasa’s full response:
INTERNATIONAL MONETARY FUND
MR EDDIE. CROSS asked the Minister of Finance and Economic Planning to inform the House on the:
- Terms and conditions agreed with the International Monetary Fund as the basis of the Staff Monitored Programme,
- The plans that exist to ensure compliance with the Staff Monitored Programme,
- Whether Zimbabwe is on the Staff Monitored Schedule.
THE MINISTER OF FINANCE AND ECONOMIC PLANNING (MR. CHINAMASA): Thank you very much Mr. Speaker. I thank the Hon. Member, Mr. Cross for asking this question. Before I do that, can I correct him that my proper title is Minister of Finance and Economic Development and not Budget, Finance and Economic Development. Nevertheless, I thank him for asking the question because it affords me an opportunity to explain our relations with the Bretton Woods Institution. Mr. Speaker Sir, we are a member of the Bretton Woods Institution which comprises the IMF, the World Bank, African Development Bank (ADB) and International Finance Corporation (IFC).
The total membership of the Bretton Woods Institution is 188 member countries. We are a serious member of these institutions. There are benefits that can accrue to us as a member. These benefits are basically in the case of IMF, receiving balance of payments support and in the case of the World Bank, to receive soft loans or concessional lending towards infrastructural development such as power generation plants, roads, et cetera. Therefore, I want to make it very clear that we are a member.
Due to the situation we went through during the past 13 years, we were unable to pay the principal debt and the installments when they became due and we got into arrears amounting to $4 billion. That means we can no longer access the benefits we are entitled to as a member.
In order to restore the benefits of membership to Zimbabwe, we entered into a Staff Monitored Programme which looks at the soundness of macro-economic policies. Therefore, we are under a Staff Monitored Programme.
Some of the benchmarks and quantitative targets that we have to fulfill are basically to amend our Mines and Minerals Act so that the sale of our minerals is more transparent. Some of them are to do with the structure of a budget, which as you know Mr. Speaker, is skewed against capital formation. 70% of the revenue we collect is going towards wages. That is not good; it means we are eating today and we are not providing for tomorrow, next year and the years to come. It is important that we work towards a structural budget so that we skew it towards capital formation, at least to the acceptable standard of 30%.
In short, we are a member of the IMF; we have dialogue with them. They are in fact here, they came yesterday for a review and we are going to discuss with them. We already know that some of the benchmarks we have not been able to fulfill, especially to do with amendments to the Mines and Minerals Act, the Precious Stones Act, et cetera will be attended to. They review this programme annually but I also need to take the platform. Mr. Speaker Sir, in my discussions with them, I asked for a different approach to the uniqueness of our position.
We have no capacity to pay the principal debt and they agree that we have no capacity to service or clear the arrears – they agree.
The Staff Monitored Programme is placing us at a standstill position. In other words, there is no growth to our economy; there is no new money. So I have been arguing with them that they should provide new money to give us capacity to be able to pay their debt. Any creditor would understand this language that if they are serious about receiving clearance and payments on the debts, they should capacitate us by giving us new money so that we are able to pay and clear our arrears.
Basically, that is the message we are conveying in our dialogue with the Bretton Woods Institution. I hope that the hon. member understands the response that I have given. I thank you Mr. Speaker.
MR. SETTLEMENT CHIKWINYA: Thank you Mr. Speaker. My supplementary question is with regards to the concept of requesting for new money. I know it is a matter of confidence with the Bretton Woods Institution. What measures have you suggested to them, which place confidence in them, for them to give you new money?
MR. CHINAMASA: The hon. member is correct. We need to restore confidence in our image as a country and that image can be restored if as a people, we speak with one voice. Also, Zimbabweans are very good at bad mouthing their own country, policies and Government outside the country. It is important on this issue that we work as united people to speak well about ourselves, not only about our country, but just about ourselves.
With Zimbabweans, you can count and this you do not find in other nationalities. If a visitor comes to Zimbabwe and says Zimbabwean people are nice and peaceful, I can bet you, you can find a Zimbabwean who will say, no, they are not. Now, that is not good. It is not good for our image and for us. What I am saying and agreeing with the honourable Member of Parliament is that, we need to restore our confidence. We used to build a track record and we need to build a track record on how we do things. We need to do things differently and we must commit ourselves, not just as Government but the whole population. If we do that, we also need, Mr. Speaker Sir, a better culture to borrow and pay back. A lot of the problems that we have with respect to our image are, as a borrower who does not have a commitment to repay the loans. That also we must change. So I hope that I have adequately answered your question.
MR. NELSON CHAMISA: I also want to thank Hon. Chinamasa for being very candid and honest for the first time. I am saying this consciously Hon. Speaker, that you may be aware that there has been this mantra that this country is under some kind of restrictive measures but from his own submission, it is clear that this country is not under any measure. Is there now a U-turn in terms of policy by Government to re-engage the West especially acknowledging that we have done a lot of bad….
MR. CHINAMASA: I thought I spelt out the policy of Government with respect to engagement. As far as I am concerned in my capacity and as far as Government is concerned, we want economies to talk to each other, irrespective of the political differences that we may have. In this respect, I basically want to address the preface that you were trying to make here. I have to respond to that preface because it is so misleading.
Some of the people I saw when I was in Washington were from the State Department and I was asking them to lift sanctions. They did not say there are no sanctions, they admitted but they gave other reasons why they are not lifting them. I met many ministers from Europe, again, asking them to lift sanctions, they did not say there are no sanctions.
When Zimbabweans themselves who are suffering say that there are no sanctions, there is a problem. Those who impose sanctions are not denying that they imposed sanctions. The argument and the dialogue is basically, when can they meet them. That is the argument. Yes, I know you are feeling guilty because you asked for sanctions.
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