Africa

IMF says country is making efforts to resuscitate economy

The International Monetary Fund (IMF) says the Zimbabwean government was making efforts to resuscitate the economy before it announced the 2002 supplementary budget last week.

The International Monetary Fund (IMF) says the Zimbabwean government was making efforts to resuscitate the economy before it announced the 2002 supplementary budget last week.

Last week, Simba Makoni, the Minister of Finance and Economic Development, presented a $52,97 billion budget for food relief, agricultural inputs, health services and for civil servants wages and salaries. In an interview yesterday, Jose Fajgenbaum, the IMF deputy-director for the African Affairs Department, said they still awaited a report from their Harare office pertaining to the 2002 Supplementary Budget. “We had seen a number of good measures which your Minister of Finance had adopted which were aimed at reducing the deficit and to address the run-away inflation,” said Fajgenbaum. “But in light of last week’s developments, we might have to wait for a report from our resident representative in your country,” the IMF wrote to Harare.

Gilbert Johnson, the IMF Harare resident was yesterday said to be out of the country until next week. The IMF adopted a declaration of non-cooperation for Zimbabwe and suspended its technical assistance after Harare failed to settle its overdue financial debt. Zimbabwe owes IMF at least US$132 million (Z$7,2 billion). The country first incurred arrears to the Bretton Woods institution last year in February and in September it was declared ineligible to use general resources of the IMF and removed from the list of countries eligible to borrow resources under the Poverty Reduction and Growth Facility trust.

Last year the foreign currency-strapped Southern African country paid US$1,6 million and only US$3million this year. The country has been hit by an acute shortage of foreign currency as the export sector is giving in to the skewed macro-economic fundamentals. Last week Makoni told Parliament that the foreign currency shortages had led to an accumulation of external payment arrears to US$1,1 billion. He urged his Cabinet colleagues to create an environment in which the country can get external financial aid.

After the IMF closed its doors to Zimbabwe, Makoni said he would ensure that IMF changes its position when they meet in September this year. But Fajgenbaum said he was not aware of the September meeting. “We do not have any firm date in September to meet Zimbabwean authorities,” said Fajgenbaum. “If we have a mission to meet Zimbabwean authorities it might have to be later than September. I do not know where people got that date.” Efforts to get a comment from Makoni were yesterday fruitless as he was attending a Cabinet meeting.

Columbus Mavhunga, The Daily News (Harare), July 31, 2002

Categories: Africa, Odious Debts, Zimbabwe

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