Zimbabwe seeks S.Africa credit, overdraft facility -finmin
Wed Sep 8, 2010 11:35am GMT
* Finmin: Want to revive 2.75 bln rand overdraft facility
* Eyeing 500 million rand credit line – Zimbabwe finmin
* Zimbabwe agrees $70 mln Botswana credit line
By Nelson Banya
HARARE, Sept 8 (Reuters) – Zimbabwe is seeking 3.25 billion rand in an
overdraft and credit facility from South Africa, Finance Minister Tendai
Biti said on Wednesday, as the country battles to reverse the effects of a
decade-long political and economic crisis.
A power-sharing government set up last year by bitter rivals President
Robert Mugabe and Prime Minister Morgan Tsvangirai has stabilised an economy
ravaged by hyperinflation, which peaked at 500 billion percent in December
2008.
But the government says it needs at least $10 billion for reconstruction.
Biti told business executives in Harare that the government was looking to
negotiate with South Africa’s government for financial assistance after
agreeing terms for a $70 million credit line with Botswana.
The government has so far failed to attract significant funds from Western
donors, who are demanding more reforms before providing aid to the unity
government.
“In South Africa … there are two facilities that we are negotiating; one
is a line of credit of 500 million rand, one is a revival of an old
overdraft facility of 2.75 billion rand,” Biti said, adding that he would
soon visit the country for discussions.
“We are also talking to private capital, the banks, and the general
understanding is that now that the South African and Zimbabwean BIPPA
(bilateral investment promotion and protection agreement) has been ratified
by the South African parliament there should be movement and traction on
that.”
The agreement, which was signed last November, protects investments from
expropriation and provides the opportunity for aggrieved investors to seek
redress in international courts.
Biti said the government was still struggling to raise revenues in the
recovering economy, collecting an average $140 million a month, the bulk of
which went on wages for public workers.