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DEBT-RIDDEN Zimbabwe’s total official Public and Publicly Guaranteed (PPG) debt is estimated at ZW$2.2 trillion for domestic debt and US$14 billion for external debt


Arrears clearance initiative placed on the back burner



PRESIDENT Emmerson Mnangagwa has effectively parked a globally endorsed debt-and-arrears clearance plan for political expediency as the Zanu PF leader seeks to retain power at all costs, a respected University of Zimbabwe scholar has said.


The country is currently pursuing a new arrears clearance and debt management plan which was launched last year.

 The country, which has appointed African Development Bank president Akinwumi Adesina (pictured) to lead negotiations with creditors and the international community, faces an uphill task in improving its rankings on the Mo Ibrahim Index as the southern African nation commits to far-reaching political governance reforms in order to restore creditors’ goodwill.

Mnangagwa appointed AfDB president Adesina to lead the whole process while former Mozambique leader Joaquim Chissano plays the role of high-level facilitator.

Eldred Masunungure, a leading scholar at the University of Zimbabwe’s Department of Governance and Public Management, told journalists that the arrears and debt strategy is currently off the rails as the ruling party seeks to consolidate power after the 23 August general elections.

“If good behaviour means losing power, Zanu PF knows which way to go,” Masunungure said.

“Where there are threats and Zanu PF says there is this threat from donors and a threat on power, it weighs: which one is better? This is a threat that we can deal with from donors after we have gained power, but if we have lost power, we may lose it for the next five years or 10 years.

“So in terms of their balance or what is better for Zanu, it is much better to attract the wrath of the donors and the international community rather than attracting the wrath of the voters. If that converts to loss of power, that is totally unacceptable to Zanu PF. I think there are these threats, but for Zanu PF, if those threats mean losing power, those threats will be ignored just as in the debt-and-arrears dialogue, it’s being ignored incrementally, but come 24 August, we will get back to Adesina and there are back channels.”

 After several failed attempts to settle arrears with international financial institutions (IFIs) such as the World Bank and AfDB, which all enjoy preferred creditor status, Zimbabwe, which has been struggling to access longterm concessional funding, adopted a new strategy which is led by AfDB.

“What was smuggled in that dialogue is the governance aspect. It was not there in the original plan, but countries such as the United States said if you want us to sign this you have to bring in the governance aspect and the President agreed,” Masungure said.

“He was in the forefront. The United States and others thought that we have put him in a fix. They thought the President would not sign the Patriotic Act (the clause in the Criminal Reform and Codification Act. Before it was signed, its impact was felt.”

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