The Zimbabwe Government will prioritise reviving a 2015 arrears clearance programme, popularly known as the Lima plan, agreed to in 2015 with global lenders including the World Bank in order to access fresh capital, Foreign Affairs Minister Walter Mzembi said on Wednesday. Under the Lima plan, Zimbabwe committed to paying off its arrears with the International Monetary Fund, World Bank and the African Development Bank as a pre-condition to accessing new lines of credit, but has so far only managed to clear overdue amounts owed to the IMF.
Zimbabwe owes the World Bank and the AfDB over $1 billion in arrears, but despite committing to paying these off, funding challenges have stalled the Lima plan leading to speculation that the plan could have been abandoned. But, Minister Mzembi told envoys accredited to Zimbabwe that the government was committed to the Lima plan.
“As we seek new economic relations, we will refocus on the 2015 Lima process on our debt repayment plan. I am confident that together we can revive that process,” he said.
Minister Mzembi said Zimbabwe was keen to normalise relations with hostile countries and would soon embark on a diplomatic charm offensive to achieve this.
“I shall be looking beyond the political fallout the country had with its erstwhile coloniser, the United Kingdom and other key Western countries including the United States, I shall seek an honest and forthright dialogue with these countries in order to let go of the past and explore and pursue mutually beneficial economic opportunities,” he said.
Some Western countries have over the past decade isolated Zimbabwe as well as imposed sanctions as punishment for correcting a colonial imbalance by re-distributing agricultural land to the black majority.
“Let us forget the past and seek new honest relations.”
Under the Lima plan, Zimbabwe also has to employ a raft of economic reforms, which include reducing the fiscal deficit to sustainable levels through the alignment and re-organisation of the public service. Currently, the government wage bill gobbles up more than half of the national budget, which is funded entirely on taxes.
The government is also expected to strengthen stability and confidence of the financial sector as well as accelerate ease of doing business reforms and reduce the cost of doing business under the Rapid Results Approach to enhance investor confidence. — New Ziana.