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according to data from the central bank.
The figures show that the country’s foreign debt stood at more than US$6,9 billion at the close of last year.
Statistics from the Reserve Bank of Zimbabwe show that the country’s total external debt stock amounted to US$6,929 million as at December 31, representing 103 percent of Gross Domestic Product, which exceeds the international debt sustainability benchmark of 60 percent.
The International Monetary Fund has since estimated that Zimbabwe’s foreign debt is projected to reach 151 percent of GDP by 2015, with 104 percent of GDP in arrears.
“The bulk of the country’s external debt is owed to multilateral creditors which account for 36 percent of the country’s total debt,” the Reserve Bank Governor Dr Gideon Gono said in the 2011 Monetary Policy Statement released recently.
Bilateral and commercial creditors are owed 33 percent and 31 percent, respectively.
The data also show that central government was the largest debtor at 57 percent while parastatals and the private sector owed 35 percent and 8 percent, respectively.
The external debt has worsened from figures recorded last year.
Figures released by the Ministry of Finance in November showed that the foreign debt stood at US$6,4 billion, with US$4,7 billion in arrears as at the end of October.
The swelling arrears on the external debt have precluded the country from receiving new loan funding from multilateral creditors such as the International Monetary Fund and the World Bank.
The country owes an estimated US$1 billion in arrears to the IMF, World Bank and African Development Bank.
Economic analysts generally conjecture that excesses in debt accumulation typically contribute to exacerbating economic problems.
Failure by the country to access funding from these multilateral institutions have contributed to the constrained capacity utilisation in industry, whose levels plateaued around 40 percent last year.
This is in addition to inadequate capital expenditure outlays by the Government due to a limited fiscal space.
Economists and the IMF have contended that the only way Zimbabwe can get out of its current debt trap is through international debt forgiveness.
Confederation of Zimbabwe Industries president Mr Joseph Kanyekanye earlier called upon the authorities to seriously consider the debt-forgiveness route.
“As CZI we have been in consultation with the International Monetary Fund and they have indicated that with the Heavily Indebted Poor Countries we can revert to positive levels within six months.
“What our political leaders need to appreciate is that when a country signs an international agreement it means you have made a binding commitment, and that comes with losing a little sovereignty,” he said.
HIPC are a group of 40 least developed countries with high levels of poverty and debt overhang which are eligible for special assistance from the IMF and the World Bank.
The Government, however, argues that applying for HIPC status has far-reaching repercussions for the economy in respect of resultant international perceptions.