IMF team still locked in Zimbabwe talks

IMF team still locked in Zimbabwe talks

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By Staff Reporter

ZIMBABWE is still in talks with the International Monetary Fund (IMF) team a week after it arrived to meet Robert Mugabe's government, which has struggled to repay its debt to the fund, said Herbert Murerwa, the finance minister.

In its worst economic crisis since independence in 1980, Zimbabwe has struggled to repay arrears of $295 million to the IMF. The IMF visit precedes a September 9 meeting in Washington, which will decide whether or not to expel Zimbabwe.

Zimbabwe has approached SA for a loan. Analysts believe that part of the loan, if granted, would be used to pay the IMF arrears, with the rest going towards vital fuel and food imports as the country struggles with worsening shortages of both commodities.

In July, Gideon Gono, Zimbabwe's central bank governor, said the country had stepped up payments to the IMF, repaying $37 million of its outstanding debt in the previous 18 months. Earlier this month though, an IMF official said there had been no payments since June. Zimbabwe is saddled with a $4.5 billion foreign debt it has struggled to repay since 1999, when it began to face crippling foreign currency shortages.

Zimbabwe's crisis has been worsened by withdrawal of aid by key donors prompted by policy differences with Mugabe. John Robertson, an independent economist, said it was likely the IMF team would take back an unfavourable report of Harare's handling of the economy. Robertson said it would be difficult to get the necessary 85% vote for expulsion from IMF member states, among which are African states supportive of Mugabe.

Mugabe (81) and in power since independence, denies he has misruled the country over the last 25 years, and charges in turn that foreign and local opponents of his land reforms have sabotaged the economy. - Reuters
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