IMF team expected this month

via IMF team expected this month – DailyNews Live 13 August 2015 by Ndakaziva Majaka

HARARE – An International Monetary Fund (IMF) mission is expected in the country at the end of this month to review the Staff Monitored Programme (SMP), businessdaily has learnt.

IMF country representative Christian Beddies said the delegation would be in the country for a fortnight assessing progress on the programme.

“An International Monetary Fund mission will visit Harare from August 31 to September 11, 2015 to undertake the second review of the SMP, a review of progress that the authorities have made under the SMP (October 2014 to December 2015),” Beddies said in an e-mailed responses.

The latest visit seeks to facilitate a platform for the IMF to engage the government and the central bank on issues affecting the economy.

Zimbabwe is under the Bretton Woods institution’s administered SMP, an informal agreement between country authorities and Fund staff to monitor the implementation of the authorities’ economic programme.

This comes as the IMF representative recently said the country had made progress on the SMP under the first review held in March this year.

“Preliminary information indicates that the authorities remain on track in the implementation of the SMP,” Beddies said then.

Zimbabwe owes close to $10 billion in external debt, half of it in arrears and the country has not received financial support from the IMF, World Bank and African Development Bank since 1999 due to policy differences between President Robert Mugabe and the West.

According to Beddies, the strategy on debt clearance remains work in progress and the RBZ, Treasury, the African Development Bank, IMF and World Bank are working on the issue.

Strong performance under the SMP will improve Zimbabwe’s capacity for debt repayment and demonstrate that it can implement reforms that could justify a fund financial management to address the country’s problems.

Zimbabwe is expected under the programme to stabilise the financial services sector as well as improving confidence by dealing with weak banks.

The Reserve Bank of Zimbabwe governor, John Mangudya, promised IMF that it would have dealt with three troubled banks — AfrAsia, MetBank and Tetrad — by June 30.

In his Mid-Term Monetary Policy Statement, Mangudya said the banking sector was now out of the woods after MetBank had improved its core capital position, as AfrAsia surrendered its licence with Tetrad under the judicial management of the Depositor’s Protection Corporation.

Under the programme, the IMF also recommended that Treasury cut its wage bill, and Finance minister, Patrick Chinamasa, yielded as he announced in his Mid-Term Fiscal Statement that plans were underway to cut the civil service wage bill by half.