via ‘Nothing wrong with Zim mortgaging minerals’ November 19, 2013 NewsDay
THERE is nothing wrong in Zimbabwe “mortgaging” its mineral resources to secure international funding for infrastructural development to revive the ailing industry, Zanu PF secretary for administration Didymus Mutasa has said.
Mutasa was responding to a question by NewsDay on why Finance minister Patrick Chinamasa was appealing for financial help from the international community when the party insisted that it would raise funds from the domestic market for its economic blueprint — Zimbabwe Agenda for Sustainable Socio-Economic Transformation (Zim Asset).
“The money is coming from the people already,” Mutasa said. “What we are simply doing is that we approach our partners like China and say: ‘give us money and hold on to our minerals’. There is nothing bad with that, this is what we call securitising our minerals.”
He said Zanu PF was not contradicting itself, but operating religiously in line with its economic blueprint.
Chinamasa recently appealed for international assistance saying lack of credit lines for the country was prohibiting economic growth as cash had become extremely expensive.
He was reportedly negotiating a $10 billion cash bailout from the Chinese government.
According to Zim Asset, Zanu PF said it would raise most of the funds to revive the ailing industry and improve the livelihoods of millions of Zimbabwe from internal sources through, among other things, the Sovereign Welfare Fund.
“Government will mobilise funding from domestic resources, which are in abundance and readily available for full exploitation and utilisation,” the economic blueprint read.
“The creation of a Sovereign Wealth Fund will be given priority under this plan to backstop and provide predictability ad sustainability to government innovative funding.”
The Zim Asset also said government would continue to engage the co-operating partners for financial assistance and pursue investment vehicles such as Public-Private Partnerships in identified special economic zones.
With over 700 companies closing down recently, Zimbabwe’s industry was at its worst, while government needs over $30 billion for infrastructure development.
Due to the liquidity constraints, banks are failing to lend money to business and critics and opposition political parties have criticised the Zanu PF government for failing to resolve the country’s economic challenges.
Chinamasa said the government needed to take significant steps towards re-engagement with the global political and economic system including the West to find ways of reviving the economy.
However, Mutasa lashed out at the West for having short sight by imposing sanctions on Zimbabwe, saying the move was shutting them out and leaving China to benefit from Zimbabwe’s resources.