Africa MoyoDeputy National EditorACCESS to affordable external financing is important as Government seeks to fund critical long-term projects under National Development Strategy 2 (NDS2) from next year, for the benefit of the people, Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube has said.Zimbabwe is, therefore, committed to the arrears clearance and debt resolution process, which has seen several key milestones achieved since late 2022.In his remarks in the inaugural Structured Dialogue Platform Booklet on the arrears clearance and debt resolution process for the period ended July 2025, Prof Ncube said “tremendous progress has been achieved” across the three strategic pillars namely Economic growth and stability reforms, Governance reforms, and Land tenure reforms (99-year lease bankability), compensation of former farm owners and the resolution of Bilateral Investment Protection and Promotion Agreements (BIPPAs).“Growing consensus, trust and confidence have been established in this key national initiative We have also seen an inclusive and transparent consultative process, as we institutionalised dialogue on Economic and Governance reforms, underpinning Zimbabwe’s Arrears Clearance and Debt Resolution Process,” he said.“As Zimbabwe transitions to the implementation of the National Development Strategy 2, in 2026, access to external concessional financing will be key for long-term funding of critical projects and programmes for the benefit of our citizens Government, therefore, remains committed to achieving the set goal of this Structured Dialogue, which is to unlock new concessional external financing, critical for achieving our economic development objectives and our Vision 2030 goal.”Prof Ncube saluted President Mnangagwa, champion of the arrears clearance and debt resolution process Dr Akinwumi Adesina, who is the outgoing president of the African Development Bank (AfDB), as well former Mozambique President Joachim Chissano, the High-Level Facilitator, for their leadership and unwavering support of the process.Ministry of Finance Permanent Secretary, Mr George Guvamatanga, said resolving the country’s debt challenge is a top priority for the Government.“The three Strategic Pillars underpinning the Structured Dialogue Process, which are supported by the Sector Working Groups, have registered tremendous progress in the implementation of reforms since December 2022, demonstrating strong reform commitment.“Notwithstanding challenges encountered at times, the Government remains strongly committed to the reform agenda, with a key focus on unlocking concessional long-term financing for the attainment of our development aspirations.“Our arrears clearance and debt resolution process roadmap is clear We will continue to collaborate with all stakeholders to ensure the resolution of the outstanding debt issue that has hindered our nation’s ability to thrive and realise its full potential,” he said.The success of this process, added Mr Guvamatanga, is crucial not only for the Government, but also for the private sector, which is “undeniably a crucial driver of economic development”.“The private sector plays a significant role in job creation, wealth generation and innovation
Our private sector should be able to access long-term capital without hindrances it currently faces.“Our people should have access to a wealth of meaningful job opportunities Hence, resolving our debt challenge is essential, and we are moving in the right direction to make this a reality,” he said.As at end of December last year, Zimbabwe’s total public and publicly guaranteed debt stock stood at US$21,5 billion, representing 47,1 percent of GDP, up from US$21,2 billion, as at end December 2023 The debt stock comprises external debt, amounting to US$13,2 billion, and domestic debt stock of US$8,3 billion.The debt owed to bilateral creditors amounted to US$6,2 billion and US$4,8 billion for multilateral creditors.External debt also includes US$2,2 billion of Reserve Bank of Zimbabwe liabilities assumed by Treasury in 2015, 2021 and 2023.Of the US$4,8 billion multilateral debt owed to the World Bank, African Development Bank, European Investment Bank and other multilateral creditors, arrears and penalties amount to US$2,6 billion.The sum is broken down as follows; US$1,6 billion to the World Bank, with arrears being US$1,5 billion (93,8 percent); US$676 million is owed to the AfDB, of which arrears are US$657 million; US$425 million to the European Investment Bank, with arrears at US$418 million; US$1,3 billion to the Afreximbank, with arrears being US$41 million; US$697 million is owed to the Trade and Development Bank, of which arrears are US$6 million; and US$73 million to other multilateral creditors, with arrears amounting to US$20 million.Head of Zimbabwe Public Debt Management Office Mr Andrew Bvumbe said the Structured Dialogue Platform Booklet on Zimbabwe’s Arrears Clearance and Debt Resolution Process serves as a comprehensive resource, documenting the history of the process, progress achieved to date, challenges faced and roadmap for the process.In December 2022, President Mnangagwa established a Structured Dialogue Platform with all its creditors and development partners to institutionalise engagement on economic and governance reforms to underpin the arrears clearance and debt resolution process.The platform is seen as crucial for Zimbabwe to realise its economic development aspirations outlined in the NDS1 (2021-2025) and the NDS2 (2026-2030), which seek to build a more resilient and prosperous economy.The Structured Dialogue Process is supported by the AfDB through the US$4 million Support for Arrears Clearance and Governance Enhancement (SACAGE) Project Grant.Discussions with the International Monetary Fund (IMF) are continuing, with a target to agree on all the prior actions, quantitative targets and structural benchmarks in the coming months in 2025.When an IMF Mission visited Harare from June 4 to 18, broad convergence was reached on the bulk of the policy issues to underpin the Staff Monitored Programme.Outstanding policy issues are being actively considered by Government and the IMF Mission.In terms of compensation, Treasury allocated US$20 million towards payment for the compensation of Bippa farmers in the 2024 National Budget and the Sector Working Group on Land Tenure Reforms, in May 2024, agreed that the money be shared equally among the 94 ratified BIPPA protected farms approved by the Compensation Committee.In December last year, Treasury paid US$18,2 million for the 85 out of the 94 approved applications and the other nine are expected to be paid in due course as they had incomplete documentation.Ten farms were fully compensated, while equal payments of US$215 355 for each farm were made for the remaining 75 farms.Share on FacebookPost on XFollow usSave
Originally published on Zimbabwe Herald
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