Zimbabwe clears IMF debt, expects new aid

WASHINGTON – Zimbabwe has cleared its major debt arrears with the International Monetary Fund averting expulsion, the IMF confirmed on Wednesday, a step Harare expects will unlock new foreign aid for its ailing economy.

“Zimbabwe today made a further payment of US$9 million (N$54,9 million) to the International Monetary Fund, thereby fully settling its remaining overdue financial obligations to the General Resources Account (GRA),” the IMF said in a statement. The IMF said the settlement removed the basis for the forced removal of Zimbabwe from the Fund.”Accordingly, the managing director withdrew his complaint today, thereby cancelling the procedure for compulsory withdrawal,” the statement said.The IMF had threatened to expel Zimbabwe over debt arrears, but President Robert Mugabe’s government said it had been making regular payments to the fund and would clear its arrears before a March deadline to pay up or risk expulsion.Zimbabwe Television (ZTV) said on Wednesday Harare – which early this month said it had paid up US$184 million to the IMF over the last 12 months and reduced its arrears on the General Resources Account to US$14,5 million – had cleared the debt.”Zimbabwe has cleared all its obligations under the General Resources Account,” it said.”This development gives Zimbabwe the right to reclaim its voting rights in the Fund…and should open up new aid,” the station said.The IMF and many other key Western donors, including the World Bank, suspended financial aid to Mugabe’s government more than six years ago over his controversial political and economic policies, including his seizures of white-owned commercial farms for redistribution to new black farmers.Critics say the policies have plunged the southern African nation into its worst crisis since independence in 1980, and Zimbabwe’s failure to service its foreign debts forced the IMF to suspend Harare’s voting rights in the fund in 2003 and sparked the expulsion threats.An IMF mission which visited Zimbabwe early this month said Mugabe’s government must implement comprehensive reforms to help repair an economy many once saw as one of Africa’s most promising.The IMF team, which will now present a report to the Fund’s executive board which is scheduled to decide Zimbabwe’s future in March, demanded that Mugabe’s government honour a pledge to stop farm invasions that have crippled commercial agriculture.The government has in the past sanctioned the land invasions, carried out to back its seizure of white-owned commercial farms for landless blacks under a sometimes violent policy launched in 2000.The decline has worsened the plight of an economy now in its sixth year of a recession shown in chronic shortages of food, foreign currency and fuel, soaring unemployment and the world’s highest inflation rates – which climbed to 613 per cent in January.Mugabe, 82 next week and in power since independence from Britain 26 years ago, denies he has mismanaged the country over the last 26 years, and charges in turn that the economy has fallen victim to sabotage by domestic and foreign opponents of his land seizures.-Nampa-ReutersThe IMF said the settlement removed the basis for the forced removal of Zimbabwe from the Fund.”Accordingly, the managing director withdrew his complaint today, thereby cancelling the procedure for compulsory withdrawal,” the statement said.The IMF had threatened to expel Zimbabwe over debt arrears, but President Robert Mugabe’s government said it had been making regular payments to the fund and would clear its arrears before a March deadline to pay up or risk expulsion.Zimbabwe Television (ZTV) said on Wednesday Harare – which early this month said it had paid up US$184 million to the IMF over the last 12 months and reduced its arrears on the General Resources Account to US$14,5 million – had cleared the debt.”Zimbabwe has cleared all its obligations under the General Resources Account,” it said.”This development gives Zimbabwe the right to reclaim its voting rights in the Fund…and should open up new aid,” the station said.The IMF and many other key Western donors, including the World Bank, suspended financial aid to Mugabe’s government more than six years ago over his controversial political and economic policies, including his seizures of white-owned commercial farms for redistribution to new black farmers.Critics say the policies have plunged the southern African nation into its worst crisis since independence in 1980, and Zimbabwe’s failure to service its foreign debts forced the IMF to suspend Harare’s voting rights in the fund in 2003 and sparked the expulsion threats.An IMF mission which visited Zimbabwe early this month said Mugabe’s government must implement comprehensive reforms to help repair an economy many once saw as one of Africa’s most promising.The IMF team, which will now present a report to the Fund’s executive board which is scheduled to decide Zimbabwe’s future in March, demanded that Mugabe’s government honour a pledge to stop farm invasions that have crippled commercial agriculture.The government has in the past sanctioned the land invasions, carried out to back its seizure of white-owned commercial farms for landless blacks under a sometimes violent policy launched in 2000.The decline has worsened the plight of an economy now in its sixth year of a recession shown in chronic shortages of food, foreign currency and fuel, soaring unemployment and the world’s highest inflation rates – which climbed to 613 per cent in January.Mugabe, 82 next week and in power since independence from Britain 26 years ago, denies he has mismanaged the country over the last 26 years, and charges in turn that the economy has fallen victim to sabotage by domestic and foreign opponents of his land seizures.-Nampa-Reuters