Chinamasa endures torrid time during overseas trip

Source: Chinamasa endures torrid time during overseas trip – The Zimbabwe Independent July 8, 2016

FINANCE minister Patrick Chinamasa had a torrid time during his current trip to France, Belgium and United Kingdom as he was grilled on the indigenisation policy, rule of law and human rights abuses, while he was mobbed by protestors in London amid indications that he will return home empty-handed without a financial bailout.

By Fidelity Mhlanga

Chinamasa, who has been virtually fighting a lone battle in government to re-engage the West through the debt clearance strategy with International Financial Institutions while attempting to attract investors and secure fresh funding, held three separate meetings in France last Thursday with French Finance Minister Michel Sapin, MEDEF-French Business Association and private companies.

During a question and answer session after Chinamasa made a presentation to MEDEF-French Business Association, corporate execuives confronted him on the clarifications made by President Robert Mugabe on the indigenisation policy.

Chinamasa said the law and the attendant changes will be re-aligned before year end.

“The main message was centred on improving the business environment, clarifying the indigenisation policy by changing the law, implement reforms, and more so the general political climate in the country,” French ambassador to Zimbabwe Laurent Delahousse said.

Chinamasa also updated the association’s members on the debt strategy and the Lima process, while also pleading with the France to channel monetary support to the private sector citing Proparco which in 2014 channelled US$20 million to local banks as an example.

“In two of the three meetings held, the arrest of Mayor (Bernard ) Manyenyeni was raised. The arrest sent a bad signal in terms of attracting investment in the country. The French government is looking for continuous improvement of human rights. The arrest of Mayor Manyenyeni was mentioned as a troublesome factor,” Delahousse said.

Manyenyeni was arrested soon after winning his suspension case by the Zimbabwe Anti-Corruption Commission for unprocedurally employing Harare Town Clerk James Mushore a day before Chinamasa held meetings in France.

Activist Itai Dzamara’s forced disappearance is also still an issue. Chinamasa took time to outline challenges Zimbabwe’s economy was facing, particularly the cash crisis currently buffeting the country.

In terms of new investment, Chinamasa also pointed out that France was now second after China. Discussions with French Minister of Finance Michel Sapin were centred on the Lima process and attracting foreign direct investment to Zimbabwe. Chinamasa pleaded with France to help convince other partners in the Paris club.

On his side, Sapin commended the role played by Chinamasa in the engagement process and pledged to help bring consensus among the Paris Club partners through roundtable discussions. He, however, pointed out that Zimbabwe has to deal with clearing arrears first.

On Tuesday angry protesters carrying placards written “No Western loans for Zanu PF” confronted Chinamasa at the London venue where he was addressing investors.

The protesters, some of whom hurled unprintable insults at him, quizzed him over the missing US$15 billion diamond revenue, as President Robert Mugabe revealed during his 92nd birthday interview, before British police intervened and escorted him away.

The under fire Chinamasa ducked several questions during an interview on the BBC HardTalk programme on issues regarding Mugabe’s old age and Zanu PF’s raging succession battles.

Zimbabwe has an ambitious external arrears clearance strategy to pay off US$1,8 billion overdue to multilateral creditors, in a bid to break its debt vicious cycle and secure at least US$2 billion in new funding to rescue a crumbling economy ravaged by a severe liquidity crunch and cash shortages, under the Lima Plan.

Currently saddled with a debt overhang of US$10,8 billion, Zimbabwe’s debt arrears amount to US$5,6 billion split between multilateral creditors (US$2,2 billion), the Paris Club, an informal grouping of bilateral creditor nations (US$2,7 billion), and non-Paris Club creditors (US$700 million).

The country has arrears estimated at US$1,8 billion with its three preferred creditors, International Monetary Fund (IMF), World Bank and African Development Bank (AfDB).

Under the Lima Plan, Zimbabwe will secure US$819 million bridge finance from the African Export-Import Bank to repay arrears to the AfDB (US$585 million); African Development Fund of the AfDB (US$16 million) and US$218 million to International Development Association, a World Bank fund for poor countries. It will also need US$896 million to repay arrears to a World Bank associate, the International Bank for Reconstruction and Development, and the IMF US$110 million. To get new funding from the AfDB, Zimbabwe — classified as one of the vulnerable economies on the continent together with Sudan, Somalia and Eritrea — needs to clear its arrears first before the end of the year and come up with a serious economic recovery programme. Chinamasa will return empty-handed.

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