HARARE: Zimbabwe has met some of the targets under the supervised economic reform programme by the International Monetary Fund (IMF), the lender’s head of delegation Domenico Fanizza has said. The IMF team is in the country for a second review of the Staff-Monitored Programme (SMP). The mission will end on September 11.
Fanizza yesterday told the Parliamentary Portfolio Committee on Finance and Economic Development that the second review was progressing well and Zimbabwe should continue to put more effort. The committee is chaired by Mutoko South MP David Chapfika. Fanizza said the meeting of the targets by Zimbabwe will likely lead to the rescheduling of its debt.
Zimbabwe’s public and publicly guaranteed debt stood at $8,4 billion as at end June 2015. This comprises external debt of $6,7 billion, representing about 47% of Gross Domestic Product, and domestic debt of $1,7 billion.
“We have talked about the purpose of this mission which is embarking on the second review under the Staff-Monitored Programme and we talked about the re-engagement process with the multilateral creditors and the bilateral creditors which is one of the main purposes of the SMP which is part of establishing relations with the international financial community so that Zimbabwe can eventually have access to its financial support,” Fanizza said.
“It’s not going to be a walk in the park, but I’m confident that we are moving forward and we have not yet finished the review. There are challenges, but we need to make sure the country can start to address the economic issues.”
Fanizza said the World Bank/IMF annual meetings in Lima, Peru, will agree on how Zimbabwe clears its outstanding arrears with the international financial institutions. “It’s a very important step, there will be consensus and it’s a preliminary stage of re-engagement,” he said.
Chapfika said he hoped progress had been made that would eventually lead to rescheduling of the debt for Zimbabwe and also opening of windows to the other multilateral and bilateral institutions.
He said the debt rescheduling would be a relief to the government and to capital projects in the country. Chapfika said about 3 million SMEs in Zimbabwe were languishing in debt and do not have any security.
He said the Zimbabwe Asset Management Company (Zamco) only accepts debt that is secured adding: “It is my hope that whatever programme that you will submit at the Lima meeting should include a relief similar to Zamco.” Zamco is a special purpose vehicle created to buy secured bad debt on the balance sheets of banks.
