Harare – THE international Monetary Fund (IMF) said Monday that it had lifted “remedial measures” against Zimbabwe after the economically stricken country recently paid its overdue obligations to the organisation.
Unfortunately for Harare however, the development does not mean the IMF would consider new requests for funding by President Robert Mugabe’s government which is in desperate need of international support to shore up the country’s long-struggling economy.
The IMF made clear that the Harare government must commit to reforms, a concept Mugabe loathes after reversing key measures recently proposed by his finance minister.
The government is woefully short in the pocket with wages for State workers delayed every month. However, finance minister Patrick Chinamasa raised eyebrows last month after somehow managing to pay $107.9 million to the IMF, ending more than 15 years of arrears.
The IMF confirmed the removal of its “remedial measures” in a statement Monday.
“The Executive Board of the IMF approved today (Monday) the removal of the remedial measures applied to Zimbabwe that had been in place because of the member’s overdue financial obligations to the Poverty Reduction and Growth Trust (PRGT), effective November 14, 2016.
“These measures are: (i) declaration of non-cooperation with the IMF (ii) the suspension of technical assistance (which had already been partially lifted, and (iii) the removal of Zimbabwe from the list of PRGT-eligible countries.
“This follows Zimbabwe’s full settlement of all of its overdue financial obligations to the PRGT of SDR 78.3 million (about US$107.9 million) on October 20, 2016.
“Zimbabwe had been in continuous arrears to the PRGT since February 2001 and was the only case of protracted arrears to the PRGT. Zimbabwe is now current on all of its financial obligations to the IMF.”
Finance minister Chinamasa has battled against opposition from Cabinet colleagues to clear the arrears in the hope of securing new funding. He is also trying to improve ties with western countries which shut their doors on Mugabe’s regime in anger after being riled by his policies.
Not so fast, the IMF warned in its statement Monday. Harare must also make good on its arrears with other creditors.
And worse for Chinamasa, Harare must implement fiscal and structural reforms first.
Reads the statement: “Notwithstanding the settlement of overdue financial obligations to the PRGT and the removal of remedial measures, consideration of any future request for IMF financing would also require Zimbabwe to comply with other applicable IMF policies,
“including to: (i) resolve its arrears to multilateral creditors (including the African Development Bank (AfDB), the World Bank, and other multilateral institutions), bilateral official creditors, and external private creditors (if any);
“and (ii) implement strong fiscal adjustment and structural reforms to restore fiscal and debt sustainability and foster private sector development.”
- New Zimbabwe