IMF praises Zimbabwe chief’s reforms

IMF zimbabwe

Zimbabwean Finance Minister Patrick Chinamasa is confounding critics with a never-say-die attitude and a performance which has won his economic reforms some rare praise from the International Monetary Fund (IMF).

An IMF team assessed the reforms in February and March and has issued a report commending the government’s efforts.

Harare’s eligibility to borrow money from the IMF and the World Bank will be determined at a board meeting of the Bretton Woods institutions on May 2.

Chinamasa emerged from last week’s annual meetings of the IMF and World Bank in Washington DC with renewed optimism that Zimbabwe was on course to receiving its first loan since 1999.

Overjoyed by an impressive IMF evaluation report which gave his economic reform efforts a massive thumbs-up, Chinamasa says he is confident that the IMF executive board will accept the government’s plan to pay $110 million in arrears to the multilateral lender.

Should the IMF approve the payment plan, Zimbabwe would later pay another $1.7 billion owed to the World Bank and African Development Bank. After nationalising the diamond mines two months ago, the government says it can raise the money.

Chinamasa, who has repeatedly opposed a radical attempt to force foreign-owned banks to cede 51 percent shareholding to locals, has been buoyed by President Robert Mugabe who ordered Indigenisation Minister Patrick Zhuwao to back off.

Chinamasa continues to confound his critics with a raft of economic reforms. As part of the changes, the government has agreed to compensate evicted white farmers, drastically trim the public service wage bill, bring efficiency to key economic sectors, and revise an indigenisation policy that has spooked foreign investors.

Chinamasa’s reforms have won him praise, although opposition parties claim they are part of a Zanu-PF ploy to pull wool over the eyes of the international community in the countdown to the national elections in 2018.

The opposition People’s Democratic Party, led by former finance minister Tendai Biti, has accused Britain’s Ambassador to Zimbabwe, Catriona Laing, of supporting Harare’s bid to unlock fresh IMF funding.

To win the support of financiers and investors, Zimbabwe must demonstrate commitment to competent management of the economy, the finance chief said.

“The IMF mission team was in the country… to assess whether we had met our targets. Their report is very positive that we met our targets and that we are on course in terms of improving our macro-economic management,” he said.

“That is what is going to attract investors into the country, that we are sound managers of our economy. They gave us a clean bill of health with respect to targets that we had set for ourselves at the end of December,” he added.

At its board meeting on Monday, the IMF will discuss Zimbabwe’s debt clearance strategy and the country is expected to have paid the $1.8bn in arrears by November. Then, Harare can receive its loan.

“We need to restore our economy to a level where it can pay its debts,” Chinamasa said. – Africa Ind

Source: The Zimbabwe Mail