. . . as Zimbabwe turns to African brothers for bailout - Zimbabwe Situation

. . . as Zimbabwe turns to African brothers for bailout

Source: . . . as Zimbabwe turns to African brothers for bailout | Daily News

Hit by more Western sanctions, Zimbabwe is now relying on neighbours for emergency bailout packages to patch over a national cash crunch that has sparked political unrest against President Emmerson Mnangagwa.

This comes after US President Donald Trump on Monday extended sanctions against Zimbabwe by a year, maintaining the national emergency declared in a previous Executive Order. This renewal comes in spite of increasing calls by African leaders to give the crisis-stricken nation some reprieve.

Earlier, South African President Cyril Ramaphosa called for sanctions against Zimbabwe to be lifted at the World Economic Forum in Davos, Switzerland. South Africa hosts the largest number of Zimbabwean migrants at three million, according to the United

Nations’ International Organisation for Migration. Ramaphosa maintains that Zimbabwe’s situation presents a challenge for the entire African continent, saying the cash-strapped nation faces “serious, serious, economic challenges and they can be assisted by the world if those sanctions are lifted.”

Analysts said it is no secret that Zimbabwe is at the end of its tether, and one can certainly sense the desperation.
In search of aid closer to home, Mnangagwa received Botswana President Mokgweetsi Eric Masisi in Harare last week for the inaugural Zimbabwe-Botswana Bi-National Commission (BNC) with Ramaphosa due in Harare for another BNC.

While the two leaders worked to re-establish mutually beneficial relations, Zimbabwe’s ministry of Foreign Affairs secretary made a huge gaffe by claiming that neighbouring Botswana was prepared to give Zimbabwe a $600m loan, of which $500m would go to the local diamond industry and $100m to private firms. It turned out to be false.

After the Botswana leader returned to Gaborone, Masisi said: “I want to clarify these reports that we are giving Zimbabwe hundreds of millions in loans. That is totally untrue. “We are not giving them a single loan. The only thing we gave them were medical supplies made in Botswana and supplementary feeding …”

More recently, Reserve Bank of Zimbabwe (RBZ) governor John Mangudya announced that the central bank has secured $985m in loans from various African banks to purchase fuel and other essential imports. Of the $985m, $641m is to come from the African Export and Import Bank, $152m from Eastern and Southern African Trade and Development Bank, and $25m from Bank of Mozambique, among others.

That being said, this time it would not be backed by diamonds, “these loans are well structured facilities contracted last year. They will be paid from future (gold) export receivables,” Mangudya told a parliamentary committee.

This follows a request made by Zimbabwean authorities in December 2018 to South Africa for financial aid of $1,2bn to help settle some of its debt — the regional powerhouse declined. However, South Africa’s Finance minister, Tito Mboweni, has said that the country is planning to extend short-term credit to its northern neighbour while alluding to helping write off Zimbabwe’s enormous external debt bill.
NKC African Economics analyst Jee-A Van Der Linde said the move by Trump cements the notion that the West remains firmly reluctant to offer Zimbabwe support.

According to Mangudya, government borrowing from the RBZ stood at nearly $3bn in December 2018, almost three times the customary overdraft limit. “Drowning in debt, we believe that it is unlikely that Zimbabwe will receive the handouts that it yearns for,” Linde said.
“If it does do, they will come at a price. Zimbabwe’s vast mineral endowments offer considerable potential, but the countless economic challenges are keeping investors at bay — though not all of them.

“Corrective interventions are likely to continue to be ad-hoc and ineffective without significant international assistance, that itself remains dependent on structural reforms that require some measure of outside help.”

COMMENTS

WORDPRESS: 2
  • comment-avatar
    Mapingu 5 months ago

    Why would any normal thinking person expect the West or any other well-meaning nation to soften its stance on Zimbabwe anyway? What logic, if any, would justify that kind of day-dreaming? The simple affect that those who staged the coup against the much hated Mugabe are now in charge can not be regarded as logic for such a call. What can be logical is what they have done since taking power from Mugabe. Now, the whole world knows that the major things they have done is sanctioning the killing of civilians by the army, not once but twice within their short stint as faces of govnt, not to mention the beatings, maimings and raping of women. Is that the reason why they shld be rewarded by removal or easing of sanctioning? Logically the behaviour of the new rulers calls for tightening of sanctions not other way. Yes, whether sanctions are meant to punish delinquent leadership or what they will always affect the ordinary man to some extent. But so be it. Nothing unusual with that. Delinquent leaders cannot be left to act with impunity simply becoz any action against them by however has the courage will affect ordinary citizens. No. So, the notion that sanctions are harming all Zimbabweans is not logical either. Why did we support sanctions against Ian Smith regime – didn’t the same argument apply then? It certainly did but we were worried about the bigger objective. We even didn’t mind blowing up (destroying) bridges and other key national assets. Why? Bigger objective was the issue. We didnt even mind closure of schools, with many of us losing our most valuable time of getting educated, with many even eventually failing to attain their potential in life. But do we regret that sacrifice? No. We only regret that after such a huge sacrifice its still not yet Uhuru for us. So, the struggle continues; & it’s not the sanctions that are perpetuating our struggle & suffering. It’s our black rulers who simply substituted former white rulers of yesteryear; & went on to perfect the art of majority subjugation. nxaaaa!!!!

  • comment-avatar
    Nyoni 5 months ago

    Has Ed learnt anything over the years his useless Bob was in charge. It appears nothing was learnt. Sanctions was slapped on you all for reasons you simply refuse to accept. Take your heads out from the sand you created yourselves and ask why are we in this situation. How can we extricate ourselves from this debacle we created. Swallow your egos and accept blame for all that has befallen our people. Remember the people make a country without them Mr Ed and co you are nothing.