Zimbabwe reveals source of IMF payments

Zimbabwe reveals source of IMF payments

• Zimbabwe pays IMF US$120 million

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• IMF shelves Zim expulsion

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By Staff Reporter

ZIMBABWE'S central bank governor says the money used to repay more than a third of its debt to the International Monetary Fund (IMF) came from money generated by exporters and holders of free funds.

This week the Zimbabwe government made a surprise payment of $120m to the IMF ahead of a September 9 meeting of the lender's executive board to discuss Zimbabwe's possible expulsion over unpaid arrears totalling $300m.

"This payment has been made following a positive response from some of our exporters and holders of free funds in response to some of the turnaround initiatives that the country is implementing," Gideon Gono told the state-controlled Herald.

The repayment came as Zimbabwean officials continue to negotiate with South Africa over a possible loan of up to $500m dollars to repay the IMF, as well as to meet mounting power, fuel and food bills.

Gono stressed that Zimbabwe's own repayment of part of the IMF debt would not harm ongoing loan negotiations with South Africa, saying rather that it would "encourage a successful conclusion of the talks".

He told the Herald the repayment of $120m represented the central bank's desire for Zimbabwe "to remain a part of the global village and the international community as represented by the IMF membership".

Also this week, Zimbabwe paid back a total of $9m to the World Bank and the African Development Bank (AfDB), the Herald reported.

News of the repayment will come as a surprise to many Zimbabweans, who had believed the country was nearly broke.

Zimbabwe's current economic problems are blamed partly on a controversial five-year old land reform programme that has slashed agricultural production, the country's economic backbone. - Sapa-dpa
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