Zimbabwe Creditors Back Plan to Clear Debt Dues, Ncube Says

(Bloomberg) -- Foreign creditors backed a plan by Zimbabwe’s Treasury to clear its debt arrears, Finance Minister Mthuli Ncube said.

Zimbabwe has $7.4 billion of foreign debt, about $2.5 billion of which is owed to multilateral lenders like the AfDB, while about $2.8 billion is owed to the Paris Club, according to a Treasury document published last week. The government needs to clear its arrears before it can raise more loans needed to rebuild an economy hobbled by the misrule of former President Robert Mugabe.

Ncube met officials from the African Development Bank, the International Monetary Fund and the World Bank on Wednesday at the IMF’s spring meetings under way in Bali, Indonesia. Representatives of the Paris Club of creditors including France, the U.K., the U.S. and South Africa also attended the meeting, he said.

“All the cooperating partners and creditors present, uniformly expressed their support for Zimbabwe and its arrears clearance Road Map,” Ncube said in an emailed statement on Wednesday.

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Attendees of the meeting also endorsed the Transitional Stabilisation Programme unveiled by Ncube last week. The two-year plan seeks to stabilize government finances, stimulate economic growth and create more jobs.

“The international community emphasized the need to judiciously implement the measures as outlined in the TSP,” Ncube said. “They reiterated that implementation of the TSP is crucial for arrears clearance. Furthermore, Zimbabwe’s request for a more accommodative treatment under the pari passu principle received positive consideration by the partners.”

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