Zimbabwe finance minister says sanctions to blame for cash crunch

Zimbabwe’s finance minister blamed international sanctions on Sunday for a cash crunch that has forced the government to delay wages to soldiers and civil servants as President Robert Mugabe faces rare popular protests.

Source: Zimbabwe finance minister says sanctions to blame for cash crunch | Reuters July 17, 2016

Western countries imposed sanctions in 2001 on Mugabe’s government over allegations of vote-rigging and human rights abuses, which he rejects, while lenders such as the International Monetary Fund (IMF) have frozen financial aid since Harare defaulted in 1999.

Zimbabwe failed to pay the army on time for the second straight month, military sources said on Friday, and Finance Minister Patrick Chinamasa said the sanctions were hurting the government’s ability to meet its obligations.

“Sanctions crippled our capacity to own our international obligations (debt payment),” Chinamasa told Reuters when asked about the wage-payment delays during an African Union summit in Kigali, Rwanda. He did not say specifically which international obligations had been affected.

“Our industry sector collapsed, the formal corporate structure collapsed and it translated itself into informal sector. So we have now a situation where revenue collection from the informal sector is not easy. We need to come up with new policies,” he added.

Anger is rising in Zimbabwe over high unemployment, corruption in government and shortages of money, which has seen people spending hours in bank queues to withdraw their money.

Without balance of payment support and foreign credit, the government is seeking to clear $1.8 billion arrears to the IMF, African Development Bank and World Bank in a bid to unlock new funding.

The IMF said on Thursday it was still far from a financial program with Mugabe’s government, which would need to resolve issues of governance, accountability, transparency and carry out economic reforms before receiving any cash.

(Reporting by Clement Uwiringiyimana; Writing by Olivia Kumwenda-Mtambo; Editing by Helen Popper)

 

COMMENTS

WORDPRESS: 7
  • comment-avatar
    tonyme 6 years ago

    Excuses such as this don’t build a nation. I thought the Look East Policy was supposed to remedy this problem. Sanctions was just a barn on the travels of a few and this had nothing to do with productivity. What about fraud,externalisation, poor monitoring of Chinese performance are to be blamed. Change in policies would change the economic direction.

  • comment-avatar
    TJINGABABILI 6 years ago

    …AND YOUR INCOMPETENCE AS WELL!!!!

  • comment-avatar
    jono austin 6 years ago

    Maybe 15billion would ease the cash crunch?

  • comment-avatar
    Barry 6 years ago

    China masara has always been a good little party puppet. Good dog.

  • comment-avatar
    Trebor Ebagum 6 years ago

    What? Sanctions were hurting the government’s ability to steal more farms? Oh wait, there are no more farms to steal. Well steal some mines or banks or businesses or whatever it is government usually steals. Or are you out of them too? Everyone knows that sanctions are just a euphemism for handouts…international charity.

  • comment-avatar
    John Wilcox 6 years ago

    The Finance Minister needs to go back to school and learn some basic economics. He is used to working out of a cash box not running the finances of a country.

  • comment-avatar
    Fallenz 6 years ago

    It’s just more drivel to feed the ears of the ignorant ZANU-PF masses. They are to blame. They hear what they want to hear, so don’t confuse them with fact… to them, facts are subversive.

    Consider this… less than half the population has an inkling of what live was like before the bank heist began in 1980. They are so enamered with their “god”, Mugabe, they reject all sources of truth. School children were indoctrinated (another innovation from North Korea) with how glorious Mugabe was as a savior. They all became little puppets unable to think for themselves.

    So, since Mugabe and his band of thieves, thugs, and murderers are all considered heroes, something or someone has to take the blame… and the Mugabe/Grace travel ban is an easy choice. If not that, it’d be some other silly explanation, like big-eyed, green aliens… just to satisfy the ears of the ignorant.