A visiting International Monetary Fund (IMF) team which is conducting a review of the 15 month successor Staff Monitored Program said Wednesday the southern African country cannot resolve its economic problems without support from international financial institutions such as the IMF and the World Bank (WB).
IMF assistant director and head of mission Domenico Fanizza said the IMF agrees with the Zimbabwean government that international support is necessary for the country to get out of the economic crisis.
“The time has come for Zimbabwe to turn the page and regain access to the financial support of the international community. More than 15 years have gone by since Zimbabwe has been cut off from the support and I think it is important to turn the page and start to look forward,” said Fanizza.
He said it was therefore, important for Zimbabwe to successfully implement the agreed reforms so that it restores relations with the international financial institutions.
Zimbabwe’s external debt stands at 7 billion U.S. dollars, including 125 million U.S. dollars owed to the IMF, 1.4 billion U. S. dollars owed to the WB. The IMF and other international financial institutions have said they cannot provide financial support before the country has paid its arrears or agreed on a plan to reschedule the debt.
The Staff Monitored Program is focusing on reforms in arrears such as public financial management and clarification of the indigenization law.
Fanizza said the IMF’s Staff Monitored Program, which Zimbabwe has been participating in since last year, constitutes a vehicle to build support around the engagement process.
Its successful implementation will lead to the key steps such as agreeing on a plan for clearing outstanding arrears with the IMF, WB, and the African Development Bank.
“Once that is done we can think about financial re-engagement. Zimbabwe can think of requesting scheduling of bilateral debt with donor through the Paris Club,” he said.
Fanizza added that the mission’s initial findings are that the Zimbabwe government has maintained the right policy direction.
“There have been important reforms undertaken in the financial sector and benchmarks that were set are being met. Things look like there is very good news in a very difficult environment,” he said. Enditem