Zim piles on more debt
By Reuters
Thursday, 26 January 2012 15:09
HARARE – Zimbabwe is having to bolster its $4 billion 2012 budget with $110
million from an 2009 emergency IMF fund, a measure of the extent of an acute
foreign exchange shortage in the southern African nation.
Finance minister Tendai Biti, who has previously opposed using money from
the $500 million IMF emergency facility, said “liquidity challenges and the
need to address our infrastructure deficit” now outweighed the need not to
take on more debt.
In all, Harare owes multilateral lenders including the IMF and World Bank
about $7 billion and is in arrears on its repayments, precluding it from
accessing any credit beyond the special financial crisis fund.
The money would be used for infrastructure, credit lines for manufacturing
and support for agriculture, he told reporters.
So far, the government had used $150 million of the funds for agriculture
and infrastructure projects, and $142 million to pay off a debt to the IMF’s
Poverty Reduction and Growth Fund (PGRF), he added.
Biti also said Zimbabwe was unlikely to meet a target of 1,8 million tonnes
of maize in its 2011-2012 harvest due to late rains, but insisted the nation
of 13 million people would not need significant imports.