Government has reiterated its commitment to clearing it arrears with multilateral creditors while at the same time pledging to compensate former white farmers for land developments as part of its re-engagement process. This came out at Zimbabwe’s first high level investment conference in the British capital, London in nearly two decades yesterday. The conference was organised by Africa Confidential and ran under the theme: “Zimbabwe 2016, Rebuilding and Rebooting.”Finance and Economic Development Minister Patrick Chinamasa who led the Zimbabwe delegation told the conference that Government remains committed to pay former white farmers for land and improvements. He said Government would set up a fund to compensate for land, developments and equipment. This comes as Ministry of Lands recently said it had valued nearly 2000 farms out of 6 240.
Minister Chinamasa also said treasury was now getting real-time reports on diamond production from the amalgamate diamond group which excludes Anjin, Jinan and Mbada. This he said would enhance transparency and accountability in the diamond sector which is said to have lost billions of dollars through trade mis-pricing and smuggling.
On the plan to clear arrears, Minister Chinamasa said Zimbabwe hopes to get its proposal to clear debt arrears with multilateral lenders signed off by December, enabling it to start talks with bilateral sovereign lenders.
“We are looking forward to the three multilateral lenders to formally adopt our debt clearance strategy when they meet in December,” said Minister Chinamasa, adding he expected this to be a “done deal”. But if we clear the arrears without a corresponding commitment of new money, we will be in a worse position . . . there is need for reciprocal commitment to provide us (with) new money, and that are the negotiations that we are undertaking.”
The Reserve Bank of Zimbabwe governor Dr John Mangudya told the same conference that Zimbabwe’s problems would be resolved if it clears its arrears and successfully completes its re-engagement programme.
“The issue with Zimbabwe is very simple, we need to complete re-engagement process to make the country a better investment destination. The first plan is the clearing of arrears ($1,8 billion) to the African Development Bank, the International Monetary Fund and the World Bank. Those arrears have not been paid since 2000 and since then the country has suffered a trauma of isolation and we want to remove that trauma through engagement,” Dr Mangudya said.
He noted that even the British had agreed that Zimbabwe should be supported. That was a good sign. That’s why we are here for this conference and to meet official representatives.”
Zimbabwe owes around $110 million to the International Monetary Fund, which it hopes to clear against a special drawing rights (SDRs) allocation of around $130 million. A bridging loan from the African Export-Import Bank would help clear arrears of $600 million to the African Development Bank, while Harare was also talking to the World Bank where it owes $900 million.