World Bank engages Zim on debt

THE World Bank will in the coming months work with international financial institutions to determine Zimbabwe’s eligibility for support under the Heavily Indebted Poor Countries, the multilateral body has said.

Report by Victoria Mtomba

According to the documents strategy note, supporting economic recovery for inclusive growth for Zimbabwe for the period 2013-15, the country owes various financial institutions $10,7 billion and the arrears continue to accumulate.

“. . . Zimbabwe would be able to access support from the WBG’s International Development Association exceptional support mechanism for arrears clearance along with domestic and other resources,” World Bank said in the report.

As of January 2013, Zimbabwe owed the World Bank $976,45 million, $127,4 million to the International Monetary Fund, $587 million to the African Development Bank million while the European Investment Bank was owed $244 million.

“The sensitivity analysis suggests that the debt situation may worsen. Although the debt indicators are expected to improve over the long-term, they will still be high with debt service including arrears being unaffordable since the arrears are so high. Development partners have expressed a general concern about Zimbabwe’s unsustainable external arrears and have called for a co-ordinated approach by the multilateral institutions to resolve this problem,” the document reads.

The World Bank said it was in discussions to enable the government to take a more direct role in the management of Multi-Donor Trust Fund-supported activities.

In the past five years, the World Bank has been supporting the country through trust funds.

“The objective of the A-MDTF (Analytical Multi-Donor Trust Fund) is to contribute to analytical work on development challenges facing Zimbabwe and to design instruments to enable government and donors to respond quickly as conditions for re-engagement change. Supported by 12 donors, the A-MDTF had funding of over $19 million for 2008-2012 and has been extended through 2013. It has improved donor co-ordination.”

The country has been receiving support from the Technical Fund such as the A-MDTF since February 2008 and a 2011 grant of $15 million from the Multi-Donor Trust Fund-Health Results Innovation was extended.

Between 1980 and 2000 the World Bank’s assistance to Zimbabwe amounted to $1,6 billion. The bank then stopped providing loans to the country after Zimbabwe slipped into arrears in 2000.

3 Responses to World Bank engages Zim on debt

  1. War Vet June 27, 2013 at 6:40 pm #

    Bull-shit! We are not going to swallow that pill again, who ever wants to play the piper then the tune is called by the Zimbos themselves. The recist Club-EU are at it again with thier clay-pot doctrines, remember the ESAP thing, how we suffered due to shortage of maize, high inflation rate and level of unemployment due to trade liberalisation, loosening of exchange controls, removal of subsidies and reduction of Gvt. axpenditure. To hell with IMF! Icho!!!!

  2. rest June 28, 2013 at 8:59 pm #

    we are hipc hell

  3. scott June 29, 2013 at 10:26 pm #

    MDC T has already promised to declare Zimbabwe a Heavily Indebted Poor Country if they come to power, all for chump change which comes not for free but with heavy interests and other undesirable attachments. Why would anyone vote for a party that is planning to go this route? There is no coming back after that. Why is it that supporters of MDC who are patriotic never question such a dumb move by their leadership? IMF and World Bank only care about the welfare of IMF and World Bank, don’t be fooled, Mr. Tsvangirai! Biti is going in with his eyes open for 2 reasons:

    1. He stands to gain a bit of money in his personal capacity
    2. He can read

    Tsvangirai: I don’t know if he is able to read..

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