Mthuli looks to clear US$2bln debt arrears in 12 months

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By UK Bureau

FINANCE minister Mthuli Ncube has said Zimbabwe is looking to clear its $2 billion arrears with the World Bank and African Development Bank in the next 12 months.

The country has over defaulted on its obligations to global lenders, resulting in arrears nearing US$6 billion.

Lenders have reacted on shutting Zimbabwe out of access to international credit.

However, in an interview with Reuters news agency, Prof Ncube said his arrears clearance plan has received crucial backing from international creditors.

“My intention is that by this time next year we would have paid off the AfDB and World Bank,” the minister told Reuters.

“All options are on the table, including the Highly Indebted Poor Country (HIPC) option debt write-off, or the HIPC-lite or the ad-hoc solutions, with sponsors.

“For sponsors, we will be talking to the G7 members to see if one or two of them, or all of them, could sponsor us and give us some lines of credit, bridging finance to be able to clear those arrears.”

However, the United States represents a potential stumbling block to Prof Ncube’s plans.

The European Union (EU) has since eased sanctions imposed to decades ago in reaction to what the West described as gross human rights abuses and electoral fraud.

Washington though maintains its ZIDERA sanctions regime.

Prof Ncube is confident regardless.

“The Americans are very supportive of Zimbabwe,” he told Reuters.

“Of course, there are points of departure, Zidera is the issue. But my view has always been that with the principles of what is in Zidera, we should embrace it as Zimbabweans.

“There is no harm in pursuing the suggestions in Zidera. Of course, in the interim, it has financial implications because of the financial sanctions in a way, so that is hurting.”