Zim in bid to unlock $100m SA loan

HARARE - Zimbabwe will next month meet South African authorities to discuss, among other issues, the $100 million loan promised by the latter four years ago.

In 2009, South Africa (SA) pledged the money to help its neighbour restart her economy — battered by a decade-long decline — but the funds are yet to be released.

Currently, Zimbabwe is struggling to access funding from multi-lateral lenders such as the International Monetary Fund (IMF) due to perceived country risk and a huge domestic and foreign debt.

The southern African country owes IMF in excess of $10 billion.

Desire Sibanda, Economic Planning and Investment Promotion ministry’s permanent secretary, told Businessdaily that a Zimbabwean delegation will be in SA in April to also ratify the Bilateral Investment Promotion and Protection Agreement (Bippa) and lure South African investors.

The Bippa is key in Zimbabwe accessing the loan.

“I cannot say much about the $100 million loan but, it is one of the issues on our agenda when we get to South Africa,” he said adding, he remained hopeful Pretoria will release the funds.

Menwhile, Zimbabwe will next month hold a two-day trade and investment conference in Johannesburg aimed at attracting foreign investors.

SA is Zimbabwe’s largest trading partner.

More than 50 percent of its imports originate from SA, and 56 percent of its exports are to the country.

Last week, Finance minister Tendai Biti was at pains to explain why the funds are yet to be released.

“I am trying to be diplomatic here, so I can safely say discussions are still taking place and Lindiwe Zulu (international relations adviser to South African President Jacob Zuma) was recently in Zimbabwe over the same issue,” he said.

Sadc countries pledged financial assistance to Zimbabwe, when a coalition government was formed between long-time rivals President Robert Mugabe and Prime Minister Morgan Tsvangirai, as part of efforts to turn around the country’s economy.

Last year, Botswana extended $462,4 million in lines of credit to Zimbabwe while Angola pledged to release $50 million as part of regional attempts to bail out the country.

Economic experts say Zimbabwe has failed to unlock loans extended to it by regional countries due to high country risk, political discord and policy inconsistencies in the unity government.

In November, former SA Finance minister Trevor Manuel stressed that his country did not want to throw money at bad policies in Zimbabwe. - John Kachembere

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