Zim pays China unbudgeted $180m

HARARE - Zimbabwe has paid China an unbudgeted $180 million towards loans owed to the Asian economic giant.

Finance minister Patrick Chinamasa said the payment is part of Zimbabwe’s effort to improve relations between the two countries.

This comes as the Treasury chief, along with President Robert Mugabe, were in China recently for a week-long visit targeted at securing bail out packages from the President Xi Jinping-led country.

Chinamasa said Zimbabwe also paid an additional $150 000 to various Bretton Woods Institutions (BWIs).

“In the first six months of this year, we have had to cough up $180 million, which was not in the budget, just to make ourselves look good,” he told breakfast meeting reviewing the outcome of his China trip on Wednesday.

“Token payments have also been made to various BWIs for debts worth about $4 billion. All this money has been out of the budget, but was meant to mend relations because there is no business without good relations,” he added.

During the China trip last month, Zimbabwe signed cooperation deals with China. The deals were mostly in the energy, agriculture and telecommunications sectors.

Zimbabwe is currently saddled by an $8, 9 billion debt, which industrialists claim has “virtually blocked access to international capital markets”.

Since 2009, China has extended $1bn in loans to Zimbabwe, with trade between the two increasing.

However, Chinamasa noted that although China made commitments to Zimbabwe, the eastern country was not offering any budgetary support.

“They are helping us with bankable projects not budgetary support. In fact no country provides budgetary support because that would mean they directly dictate terms of our economy to us,” he said.

Chinamasa further said  China provided additional funds to help government assume state-owned TelOne(‘s) debt of $359 million and revive the fixed line operator.

“I can tell you they have also given us $290 million and an additional $98 million for TelOne operations to help with tower coverage for network around the country,” he said.

China will also help Zimbabwe establish special economic zones and industrial parks to jump-start exports.
 

Comments (1)

Good minister. Responsible. One who pays debt secures country's future. Good staff

liberty shungu - 18 September 2014

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