Source: Zimbabwe misses its own debt repayment deadline | African Business | BDlive July 16, 2016
HARARE/WASHINGTON — Zimbabwe failed to repay $1.8bn to the International Monetary Fund (IMF), the World Bank and African Development Bank by its own June 30 deadline.
“Right now, we’ve not paid anything,” John Mangudya, Zimbabwe’s central bank governor, said by phone from Harare on Thursday. “That is why we have this re-engagement process with international financial institutions.”
Finance Minister Patrick Chinamasa said earlier that the country would repay at least $1.8bn by the end of June to be able to resume borrowing in a bid to revive an economy that’s half the size it was in 2000. Zimbabwe owed $110m to the IMF, $1.1bn to the World Bank and $601m to the African Development Bank, Mangudya said in an e-mailed response to questions on Thursday.
The IMF would only consider requests for financing once Zimbabwe cleared its arrears with the lender and the IMF board approved the normalisation of relations with the country, spokesman Gerry Rice told reporters on Thursday in Washington.
“Irrespective of the calendar for arrears clearance, the economy needs immediate reforms to address the vulnerabilities that have come to the fore,” Rice said. “Expeditious implementation of those reforms is critical to reverse Zimbabwe’s economic decline.”
The country is experiencing an unprecedented liquidity crisis that has led to civil servants being paid late and some private-sector workers receiving goods instead of salaries. That sparked a national strike on July 6. The country was also hit by riots as taxi operators protested against what they said was police harassment and Zimbabwe’s main border post with SA was shut for a weekend after the government banned the import of certain goods, sparking demonstrations from traders.
Most banks have limited cash withdrawals to $100 a day, leading to snaking queues at automated teller machines countrywide. Zimbabwe’s foreign direct investment fell 23% to $421m in 2015, according to a report in the Financial Gazette newspaper that cited UN data.