A Zimbabwe debt conference has tentatively been set for April but Government in conjunction with the African Development Bank is flexible as it bids for the country’s creditors and development partners to brainstorm on a lasting solution to the debt overhang. Zimbabwe’s public and publicly guaranteed debt burden is estimated at $8 billion comprising an external debt of $7,2 billion and, domestic debt of $1,1 billion. Of the $7,2 billion external debt, the stock of accumulated arrears would account for 81 percent of the total external debt.
Secretary for Finance and Economic Development Mr Willard Manungo said in an interview that the country has made payments to the World Bank, of about $4 million and $250 000 to the European Union creditors on top of the $150 000 to the International Monetary Fund. He said the country is expected to perform in line with expectations this quarter.
“We are in line with our obligations in as far as paying tokens to those whom we owe is concerned,” said Mr Manungo.
On the debt conference Mr Manungo said a consideration will be made to the availability of international financial institutions and that of Government.
“As you know Zimbabwe was ruled to be not eligible for the Heavily Indebted Poor Countries status so we have to think outside the box as regards the debt resolution is concerned,” said Mr Manungo.
The IMF ruled Zimbabwe not poor enough to qualify for HIPC initiative.
Mr Manungo was speaking on the sidelines of a Fiscal Space Policy Dialogue yesterday. The dialogue was held under the theme “Enhancing Fiscal Space in Support of the National Budget & Zim-Asset”.
While addressing the conference Mr Manungo said budget implementation continues to face expenditure pressures against low revenue collections.
“Expenditure growth continue to outweigh revenue growth. In addition, the budget remain skewed towards recurrent expenditures of about 92 percent leaving only 8 percent for capital development programmes,” said Mr Manungo.
“It is in view of this situation the Government is working on managing and rationalising the recurrent expenditures, reducing the wage bill, engaging co-operating partners for budget support, pursuing private sector investment and addressing the external debt overhang among other issues,” he said.
Reserve Bank of Zimbabwe governor Dr John Mangudya told the conference that “bold decisions” should be made if the economic turnaround is to be enhanced.