The World Bank is considering setting aside at least $2,7 million from its State and Peace Building Fund to rehabilitate Zimbabwe’s water supply and sanitation infrastructure next year, but reiterated the multilateral financial institution cannot fund major projects in the country because of its debt overhang.
The country owes the World Bank about $600 million.
It also owes the International Monetary Fund $140 million and the African Development Bank about $400 million.
These institutions cite these debts as the reason why the country cannot access financial support from them.
In an exclusive interview, World Bank Zimbabwe acting manager Peter Nicholas said the funding is coming from a trust and is just awaiting approval from the Bank.
He said the money will probably be released early next year to fund water supply and sanitation project in Beitbridge.
“Because of Zimbabwe’s arrears to the World Bank, we cannot at this stage fund major infrastructure projects, although we are using a ‘trust fund’ to provide finance for rehabilitation of water supply and sanitation infrastructure in Beitbridge,” Nicholas said.
“Resumption of full-scale World Bank support will need to await progress towards the clearance of Zimbabwe’s arrears to the Bank,” Nicholas said.
The country’s total external debt, including private sector loans, is currently estimated at $6,7 billion and is expected to increase to $7,6 billion by year-end through interest.
Nicholas said the World Bank would continue to provide agricultural inputs to vulnerable communal farmers and strengthen healthcare capacity in mission hospitals.
He said the bank is also administering a trust fund that is currently undertaking studies on economic and sectoral issues in the country.