Zimbabwe misses IMF targets, again – Chinamasa

via Govt misses IMF targets, again – Chinamasa | The Source  March 26, 2014

Zimbabwe will miss targets set under the International Monetary Fund’s Staff Monitored Programme, as it fails to meet key benchmarks such as reducing the government’s  wage bill, Finance Minister Patrick Chinamasa said on Wednesday.

Zimbabwe spends 70 percent of its budget on salaries, and  Chinamasa  said this would persist in the short- to medium term.

“It is clear at this stage that we have not been able to address some of the issues we discussed last year,” Chinamasa told journalists.

“I have told the (IMF) that with respect to employment costs (as a proportion of the budget), we cannot address those in the short to medium term. It is not something that we can address overnight, which would mean very drastic measures which I am not prepared to take.

“That would mean retrenchment of the civil service and so on. I proposed to them that I will address this in the long-term through creating growth in the economy, increasing the revenue base, GDP, so that employment costs can take their appropriate proportion within a bigger cake.”

In January,  IMF extended the SMP by six months  to allow the government to strengthen its policies and deliver on outstanding commitments.

Zimbabwe began the SMP last June but requested an extension after failing to meet the December timeline. If successful, the programme could help it clear over $10 billion in external debts and give it access to new credit from international lenders.

Chinamasa said the government has also not been able to make amendments to the Mines and Minerals Act and was still addressing legislative gaps on corporate governance in the financial services sector.

“I said the consultations will take time because I do not want to take measures before I have consulted widely, because (the legislation) must be able to last and must have the buy-in of the stakeholders in the financial services sector.

“So we are looking at amendments to the Banking Act to address issues. For instance, some of the banks…are guilty of insider loans so we need measures in the banking law to be able to prevent, and not to act post-factor.”

Chinamasa said he also need time to improve accountability and transparency in the diamond sector.

The next review will be in June and Chinamasa said he hoped to have made progress. The IMF has said it will reopen its Harare country office, nearly a decade after it closed it, signalling the thawing of relations with Zimbabwe.

The IMF restored Zimbabwe’s voting rights in 2010 after cancelling them in 2003  following Harare’s failure  to service its debt.

Chinamasa said  Zimbabwe had agreed to a ‘token payment plan.’

“We have no capacity to pay our obligations right now but the payments we are making are to show our commitment,” he said.


  • comment-avatar
    John Thomas 8 years ago

    When has ZANU ever met any target in a good way. Targets for stupidity, brutality, criminality, these they can meet.

  • comment-avatar
    June Chando 8 years ago

    When The MDC spoke of expanding the cake ZANU PF was stuck on tacking over of SHRINKING industries…but the Finance Minister is now talking juice…or was he perhaps reading from some notes left behind by Tendai Biti??? So ZANU PF remains clueless 34 years on??? And we are supposed to believe they got a free and fair landslide victory??? What new trick do they think the electorate thought they could come up with??? Kusafunga kunoremera tenzi chokwadi. Humbavha has become endemic and wholesale…How about ZANU PF admits it has failed to take the nation anywhere or that they have been ‘stealing votes’??? The unity government for all its problems had done so much more for the nation over the same time frame as this current ZANU PF regime has been at the helm…SAD!

  • comment-avatar

    SO there you have it, in his own words. Chinamasa feels that,

    “It is not something that we can address overnight, which would mean very drastic measures which I am not prepared to take.”

    Even though the country is facing a very drastic situation, neither he nor his boss’ government is prepared to make any meaningful changes in the way they do business.

  • comment-avatar
    Senzachena 8 years ago

    There is not a lot of point in taking “drastic measures” now, it is too late, the money has run out and unless a miracle occurs there will be no pay for Govt employees shortly. Then they will desert their posts and run to SA or Bots to try and feed their families. I suppose this is one way to reduce the bloated civil service!

  • comment-avatar
    mukanya 8 years ago

    Remove ghost workers they are also wondering why they are being paid

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    jobolinko 8 years ago

    They even added more soldiers during Gnu to fix mdc and Biti in particular and if i remember well mugabe was saying the people we gave the job are refusing with the money what a shame from a person who is a head of state.