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World Bank, Zim in debt talks

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The World Bank (WB) is engaged in discussions with the government on the clearance of the $8,8 billion debt arrears the country with a view to finding a debt resolution and re-establish full trading relations with the country.

WB country director for Zimbabwe, Zambia and Malawi Kundhavi Kadiresan yesterday said there was need to address the arrears owed to the World Bank and other multilateral institutions.

“For us to come back to be re-established we need to clear the arrears situation. What we are really looking at is a medium-term structural policy, satisfactory performance on the staff-monitored policy by World Bank,” said Kadiresan

“A good record of macroeconomic policy will be good for us to start talking about arrears. Debt reconciliation is something that we want. We are hoping that the International Monetary Fund programme agreement will be met,” she said.

The WB boss said they were waiting for a progress action plan on ghost workers, government stance on indigenisation and to make sense of the law.

Kadiresan said Zimbabwe was not on the list of countries of Highly Indebted Poor Countries (HIPC) but could qualify to be among that group of countries.

“We still need an overall record for good macroeconomic framework. Once that is in place it will be easy for us to take the issue further,” she said.

The WB is yet resume normal business with Zimbabwe as it was still assessing the macroeconomic environment.

Kadiresan believes the country would require $13 billion in investment to stabilise the energy sector and to roll out the rural electrification project.

The country’s economy is expected to grow by 9% this year due to the stabilisation of the economic and political environment that has resulted in inflation coming down to single digits.

However, despite the positive growth in the economy, the country is still plugued by liquidity challenges and uncertainty.

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