President reassures development partners, creditors
PRESIDENT Mnangagwa has reassured development partners and creditors that the Government is committed to implementing key reforms that are critical to resolving the country’s nearly US$8,3 billion debts and arrears.
He was speaking during the high-level debt resolution forum in Harare on Monday.
The high-level debt forum was also addressed by African Development Bank (AfDB) president and official champion for Zimbabwe’s arrears clearance and debt resolution programme Dr Akinwumi Adesina, and facilitator of the high-level dialogues and former Mozambique President Joachim Chissano.
It was attended by Government officials, development partners, private sector, former farm owners and civil society organisations.
President Mnangagwa said in spite of the challenges associated with the debt overhang and further exacerbated by the albatross of the illegal economic sanctions, “Zimbabwe is realising key milestones towards moving our country forward for the good of our people”.
“The three key reform pillars for Zimbabwe’s implementation programme include governance reforms, land tenure reforms, compensation of former farm owners and the resolution of Bilateral Investment Protection and Promotion Agreements (BIPPAs).”
Dr Adesina expressed concern over Zimbabwe’s debt, and a debt accumulation from arrears. He said Zimbabwe cannot run up the hill of economic recovery carrying a backpack of debt.
“It is time for a comprehensive debt arrears clearance and debt resolution for Zimbabwe. But getting there is not a walk in the park. We must address history, to make history.”
Dr Adesina added that economic sanctions were driving Zimbabwe further into unsustainable debt. He said the debt itself was not as debilitating as the arrears on the debt, since the country cannot access international concessional financing or other revenue or less expensive financing to pay down its debt obligations.
The majority of Zimbabwe’s combined US$8,3 billion bilateral and multilateral debt is accounted for by arrears.
Presently, Zimbabwe is publishing public debt statistics and debt payment information to ensure transparency and accountability.
President Mnangagwa said there was need to nurture the trust and good will, which continues to grow among all parties.
He added that Zimbabwe’s sustainable economic recovery requires augmentation by a comprehensive arrears clearance and debt resolution process, backed by international financial institutions and the international community at large.
In his remarks, former President Chissano said it was critical to resolve the debt and arrears situation, so as to boost the SADC region as a whole.
On land reforms and compensation, Dr Adesina said the AfDB is working with Zimbabwe to develop innovative financial instruments and structures that can be used to front-load the mobilisation of US$3,5 billion for compensation of former farm owners. He cautioned against further delays, saying they could erode trust and confidence.
“So, timing counts; responsiveness counts; and financial sustainability counts,” said Dr Adesina.
He appealed to development partners “to work together on this proposed structure, which can help leverage capital markets to fund compensations without additional debt for Zimbabwe”.
Dr Adesina commended the Government for its decision to make land titles available to enhance the security of commercial farmland.
“These would be for 99-year leases, which are also commercially viable, bankable, and transferable,” he said.
On electoral reforms, President Mnangagwa assured stakeholders that Zimbabwe has put in place the requisite mechanisms to guarantee peaceful, free, fair and credible elections scheduled for August this year.
“My Government stands committed to consolidating constitutionalism, rule of law, good governance and protecting constitutionally enshrined rights and freedoms,” he said.
For a long time now, President Mnangagwa has been calling for peaceful elections, warning those bent on causing violence that the full wrath of the law would descend on them.
And for demanding peace before, during and after the elections, Dr Adesina commended Zimbabwe.
He further emphasised the need for stakeholders to ensure that there is concrete and measurable progress on the Zimbabwe Democracy and Economic Recovery Act (ZIDERA), which is critical for re-engagement with the United States and could be used to support advocacy for the lifting of select sanctions imposed by the US Congress.
Dr Adesina and former President Chissano visited the US earlier this month to meet with leaders in the US Congress, Treasury Department, State Department, and other US agencies.
“It was very clear that there is support for this high-level dialogue, and a hope that it will translate into concrete and measurable progress on the ground to inform a consideration of the lifting of the sanctions under ZIDERA,” said Dr Adesina.
In December 2022, the Government established a structured dialogue platform with all creditors and development partners, to institutionalise structured dialogue on economic and governance reforms to underpin the arrears clearance and debt resolution process.