Samson » October 30th, 2016
by Roberta Katunga, Senior Business Reporter 30th October, 2016
REMEDIAL measures imposed on Zimbabwe by the International Monetary Fund need to be lifted before the Fund provides the country with access to financing, the IMF said.
Responding to questions from journalists during a Press briefing in Washington last week, communications director Mr Gerry Rice said the settling of arrears by Zimbabwe with the Fund does not automatically provide the country with accessing to funding.
Last week, the Government cleared its arrears with the IMF of $109 million but still owes the World Bank and the African Development Bank about $1,6 billion.
Mr Rice said although he did not have details on Zimbabwe’s status of arrears with other institutions, clearance of those arrears would be an important consideration for the IMF in terms of support to the country.
“The settling of their arrears with the Fund, as you say, does not automatically provide Zimbabwe with access to IMF financing. There are a number of steps that need to be taken. It requires a decision by our Board to lift the remaining remedial measures that had been imposed on Zimbabwe because of the arrears,” he said.
On whether the IMF was aware of the country’s plans to clear outstanding arrears, Mr Rice said he did not have the details but clearing the arrears would be a critical step required by the Fund to continue with its support.
According to economist Mr Kipson Gundani, it is imperative for the country to satisfy certain conditions or targets that were set by the IMF like those under the Staff Monitored Programme (SMP).
An SMP is an informal agreement between authorities and the IMF to monitor the implementation of an economic programme.
“Such reform agendas are put in place for countries to become economically sustainable. It is important for a country to meet the policies that the IMF believes in so as to qualify to levels of economic liberalisation,” said Mr Gundani.
Zimbabwe started working on the SMP in 2014 and the IMF team reviewed the progress before the country moved to the second and third reviews. The country met targets for the SMP in the first and second reviews.
Last year when the IMF team visited the country, the head of the delegation Domenico Fanizza said if Zimbabwe succeeded in the third review, it would get a three-year credible reform programme that would tackle underlying problems in the economy.
Mr Gundani said by settling its arrears, this would unlock fresh capital for the country that is facing liquidity challenges and a deflationary environment. Last year, the Government engaged its creditors in a bid to pave way for debt clearance
Samson » October 30th, 2016
4 days ago by Mathew Ogunsina
This is another milestone set by Beijing to be in the court of the great powers, those whose currency refers. As of January 1, the yuan (or remimbi) rub shoulders with the US dollar, South African rand and the Botswana pula in the pockets of the people of Zimbabwe.
It must be said that the situation in this country is special. He has no national currency since 2009.
The failed land reform President-dictator Robert Mugabe has led to a severe economic crisis that the government tried to stop cranking printing money. Result: hyperinflation than 500,000,000,000% according to the IMF. In 2009, the face value of the last break of the Zimbabwean dollar circulated by the national bank of the country had reached a surreal level: 100.000 billion!
This colossal runaway had forced the country to bury the dollar and instead use foreign currencies. This summer, the last ticket holders could exchange to the central bank over $ 1 to 35 million Zimbabwean billion. An absolutely dizzying exchange rate.
Xi Jinping has mobilized to impose the yuan
The yuan, he built several months ago the basket of currencies that make up the foreign exchange reserves of Zimbabwe. And so, in 2016, it can be used for all payments of daily life. To succeed in imposing and its currency, China has multiplied gestures of goodwill. Xi Jinping, the president, whose movements are rare, personally went to Harare, the capital, in early December, with some arguments in the round.
China is now the largest trading partner of the country, agreed to write off a debt of 40 million US dollars was Zimbabwe and pledged a loan of $ 1 billion, with lower rates. Several agreements, mainly aimed to enhance and rebuild infrastructure were also signed.
inexpensive gestures to the world’s largest economy whose currency gains greater legitimacy in exchange. The side of the Zimbabwean government is a winning transaction. President Robert Mugabe, speaking Tuesday hope it will facilitate the “cash injection” and even takes to dream that this agreement “could give a boost to the economy.” Shunned by his former Western partners because of its failure to respect human rights, Zimbabwe looks more than ever towards the East ..
Molson88: Thank you for posting this, Samson! I have always held my breath a little on whether the Zim would actually revalue or not. It will be interesting to see what happens in the near future.