Zimbabwe’s crippled economy received a boost yesterday when the IMF sanctioned a US$510 million loan, its first to the country in a decade.
But the move stirred conflict between the partners in Zimbabwe’s unity government amid fears it would used to shore up Zimbabwean President Robert Mugabe’s regime.
Zimbabwean Reserve Bank Governor Gideon Gono said the IMF had paid it US$400 million via a fund for developing countries hit by the global recession, with a further US$110 million to follow next week.
“I can confirm that the Reserve Bank of Zimbabwe did receive the funds,” Gono told the state-owned Herald newspaper, adding that he and Zimbabwean Finance Minister Tendai Biti would discuss how to deploy the funds.
The money will be used to replenish Zimbabwe’s dwindling foreign currency reserves and has been released on condition it is not diverted to other projects.
Political leaders hailed the decision as a sign that Zimbabwe’s unity government is ending the country’s spell in the international wilderness.
The IMF wound down its program there 10 years ago and formally withdrew in 2002, adopting a “declaration of noncooperation” with the Mugabe government.
Eddie Cross, an economist and policy co-ordinator for the Movement for Democratic Change (MDC), said: “This is the first significant IMF involvement with Zimbabwe for more than a decade”
“The magnitude is very substantial, about half our total budget this year. It’s a very large contribution,” Cross said.
The MDC, however, opposed Gono’s appointment at the reserve bank and will be anxious to ensure he does not control the funds in case they are directed to the coffers of Mugabe’s Zanu-PF party instead of the impoverished population.
“Gono is part of the reactionary elements fighting the unity government,” Cross said. “He’s been the principal culprit for the meltdown of the economy. We’ve been successful in ... circumventing him and that’s what we’ll do with this money.”
“It will be controlled very carefully, otherwise it will be used and abused and find its way to all sorts of nefarious activities and corrupt institutions,” he said.
Another MDC source said: “Gono has tried to take the money but Biti is trying to take charge.”
The source added that Zimbabwe may be unable to draw down the funds until it has shown it can repay a debt of US$5.7 billion to various creditors.
“The funds will come but it will be in the context of Zimbabwe having committed to clearing these debts,” he said.
The IMF told Zimbabwe two weeks ago that it would not receive the US$510 million until it repaid arrears of US$142.2 million. G20 leaders agreed in April to treble to US$750 billion the IMF’s capacity to help struggling economies. The IMF Web site said all 186 members were eligible to receive the money from Aug. 28 in proportion to their existing quotas with the fund.
Zimbabwe has suffered a decade of economic meltdown and record hyperinflation, worsened by the withdrawal of western aid over policy differences with Mugabe’s previous administration, before he formed the unity government this year with rival, Morgan Tsvangirai.
Western donors have demanded broad political and economic reforms before giving direct aid to the government. Donors currently provide only humanitarian aid.
BLOODSHED: North Koreans take extreme measures to avoid being taken prisoner and sometimes execute their own forces, Ukrainian President Volodymyr Zelenskiy said Ukrainian President Volodymyr Zelenskiy on Saturday said that Russian and North Korean forces sustained heavy losses in fighting in Russia’s southern Kursk region. Ukrainian and Western assessments say that about 11,000 North Korean troops are deployed in the Kursk region, where Ukrainian forces occupy swathes of territory after staging a mass cross-border incursion in August last year. In his nightly video address, Zelenskiy quoted a report from Ukrainian Commander-in-Chief Oleksandr Syrskyi as saying that the battles had taken place near the village of Makhnovka, not far from the Ukrainian border. “In battles yesterday and today near just one village, Makhnovka,
The foreign ministers of Germany, France and Poland on Tuesday expressed concern about “the political crisis” in Georgia, two days after Mikheil Kavelashvili was formally inaugurated as president of the South Caucasus nation, cementing the ruling party’s grip in what the opposition calls a blow to the country’s EU aspirations and a victory for former imperial ruler Russia. “We strongly condemn last week’s violence against peaceful protesters, media and opposition leaders, and recall Georgian authorities’ responsibility to respect human rights and protect fundamental freedoms, including the freedom to assembly and media freedom,” the three ministers wrote in a joint statement. In reaction
BARRIER BLAME: An aviation expert questioned the location of a solid wall past the end of the runway, saying that it was ‘very bad luck for this particular airplane’ A team of US investigators, including representatives from Boeing, on Tuesday examined the site of a plane crash that killed 179 people in South Korea, while authorities were conducting safety inspections on all Boeing 737-800 aircraft operated by the country’s airlines. All but two of the 181 people aboard the Boeing 737-800 operated by South Korean budget airline Jeju Air died in Sunday’s crash. Video showed the aircraft, without its landing gear deployed, crash-landed on its belly and overshoot a runaway at Muan International Airport before it slammed into a barrier and burst into flames. The plane was seen having engine trouble.
REVELRY ON HOLD: Students marched in Belgrade amid New Year’s events, saying that ‘there is nothing to celebrate’ after the train station tragedy killed 15 Thousands of students marched in Belgrade and two other Serbian cities during a New Year’s Eve protest that went into yesterday, demanding accountability over the fatal collapse of a train station roof in November. The incident in the city of Novi Sad occurred on Nov. 1 at a newly renovated train facility, killing 14 people — aged six to 74 — at the scene, while a 15th person died in hospital weeks later. Public outrage over the tragedy has sparked nationwide protests, with many blaming the deaths on corruption and inadequate oversight of construction projects. In Belgrade, university students marched through the capital
RSS