Business / Economy
IMF snubs US, backs Zimbabwe
14 Feb 2016 at 05:30hrs | Views
The IMF will not be influenced by American calls to tighten sanctions on Zimbabwe and will proceed with its re-engagement with Zimbabwe as planned, an official has said.
About two weeks ago, US senator Bob Corker wrote to US treasury secretary Mr Jacob Lew saying Washington should pressure the IMF and World Bank not to lend money to Zimbabwe until American-prescribed conditions were met.
Among the conditions were security sector "reforms" and reversing land reforms, all opposition mantras feeding from Zidera, Washington's sanctions law on Zimbabwe.
Responding to inquiries by The Sunday Mail, IMF Zimbabwe head Mr Christian Beddies said experts from the multilateral lending institution would visit Harare next week to assess implementation of the last phase of the Staff Monitored Programme (2013-2015).
Mr Beddies said Zimbabwe would access new money if it fulfilled the Arrears Clearance Strategy that IMF executives accepted in Lima, Peru in October 2015.
"I think everybody is entitled to have a view on issues pertaining to an institution they are a member of. My interpretation of what the Senator said was that new financing should be subject to reforms, which, by the way, applies to any country that the IMF has a financial arrangement with.
"What these reforms could look like is an area subject to discussion. (Accessing new money from the IMF) will depend on the execution of the Arrears Clearance Strategy that the authorities presented in Lima in October 2015, and the drawing up of a strong economic reform programme that could be supported with Fund resources."
He added: "The upcoming Article IV consultation provides an opportunity to discuss how such cooperation could look like. The eight-member mission, led by our Mission Chief, Mr Domenico Fanizza, will be in Harare from February 24 to March 11, 2016.
"The mission will undertake the third and final review of the Staff Monitored Programme and the Annual Article IV consultation. The Article IV consultation is an exercise where we step back a little from the day-to-day challenges and provide a medium term assessment of the economy, in consultation with the authorities."
Zimbabwe has been under US and European Union sanctions since 2001 on account of its stand-off with Britain over the Fast-Track Land Reform Programme.
After enduring the ruinous embargo for 15 years, the country is targeting growth.
Its Arrears Clearance Strategy entails using Special Drawing Rights to settle outstanding payments (US$100 million-plus) to the IMF, "a bridge loan" to clear African Development Bank debts (US$600 million) and medium to long-term loan facilities to settle World Bank arrears (US$1,1 billion).
The strategy will be backed by "bold policy reform measures aimed at debt sustainability and improving the socio-economic environment" that include "strengthening financial sector confidence, accelerating the re-engagement process with the international community and revitalising agriculture and the agro-processing value chain".
Part of the strategy document reads, "It also entails advancing beneficiation and/or value addition to the agriculture and mining resource endowment, focusing on infrastructure development, unlocking the potential of small to medium enterprises and improving the investment climate.
"The clearance plan is also anchored on accelerated public enterprises reform and improving public finance management, modernisation of the labour laws and aligning of laws to the Constitution and adhering to the rule of law and the pursuit of an anti-corruption thrust."
Finance Minister Patrick Chinamasa and his information counterpart, Dr Christopher Mushohwe, have already dismissed Mr Corker.
Minister Chinamasa said, "I hope that as he has written this letter, he keeps an open mind with respect to the reality of the situation in Zimbabwe and should not be swayed by distorted information he receives about our country.
"He makes reference to equitable, legal and transparent land reform yet that's basically what we have undertaken. It's much more transparent and equitable than the land tenure system and ownership that existed before the land reform."
Dr Mushohwe weighed in: "The letter dated 28 January, 2016, by Bob Corker, chairman of the US Senate Committee on Foreign Relations, to the US Secretary of the Treasury, Jacob Lew, concerning Zimbabwe's efforts at clearing her arrears and securing new lines of credit from the International Monetary Fund, World Bank, and the African Development Bank once again reveals and confirms US attempts at gross interference in the internal politics of our country, Zimbabwe, contrary to norms of international relations. "Much worse, it reveals US control of what are supposed to be international financial institutions, including seeking to turn regime change in independent-minded African countries like Zimbabwe.
"The statement leaves no one in doubt about the reality of country sanctions, contrary to claims that these are targeted, or that Zimbabwe is being denied lines of credit for failing to service its arrears.
"What lies at the heart of the US foreign policy towards Zimbabwe, is the vain hope for regime change through sanctions-aggravated social conditions, which the US hopes will benefit the opposition.
"The ultimate objective is to reverse the land reform and to weaken Zimbabwe's status as a sovereign, independent African state."
About two weeks ago, US senator Bob Corker wrote to US treasury secretary Mr Jacob Lew saying Washington should pressure the IMF and World Bank not to lend money to Zimbabwe until American-prescribed conditions were met.
Among the conditions were security sector "reforms" and reversing land reforms, all opposition mantras feeding from Zidera, Washington's sanctions law on Zimbabwe.
Responding to inquiries by The Sunday Mail, IMF Zimbabwe head Mr Christian Beddies said experts from the multilateral lending institution would visit Harare next week to assess implementation of the last phase of the Staff Monitored Programme (2013-2015).
Mr Beddies said Zimbabwe would access new money if it fulfilled the Arrears Clearance Strategy that IMF executives accepted in Lima, Peru in October 2015.
"I think everybody is entitled to have a view on issues pertaining to an institution they are a member of. My interpretation of what the Senator said was that new financing should be subject to reforms, which, by the way, applies to any country that the IMF has a financial arrangement with.
"What these reforms could look like is an area subject to discussion. (Accessing new money from the IMF) will depend on the execution of the Arrears Clearance Strategy that the authorities presented in Lima in October 2015, and the drawing up of a strong economic reform programme that could be supported with Fund resources."
He added: "The upcoming Article IV consultation provides an opportunity to discuss how such cooperation could look like. The eight-member mission, led by our Mission Chief, Mr Domenico Fanizza, will be in Harare from February 24 to March 11, 2016.
"The mission will undertake the third and final review of the Staff Monitored Programme and the Annual Article IV consultation. The Article IV consultation is an exercise where we step back a little from the day-to-day challenges and provide a medium term assessment of the economy, in consultation with the authorities."
Zimbabwe has been under US and European Union sanctions since 2001 on account of its stand-off with Britain over the Fast-Track Land Reform Programme.
After enduring the ruinous embargo for 15 years, the country is targeting growth.
Its Arrears Clearance Strategy entails using Special Drawing Rights to settle outstanding payments (US$100 million-plus) to the IMF, "a bridge loan" to clear African Development Bank debts (US$600 million) and medium to long-term loan facilities to settle World Bank arrears (US$1,1 billion).
The strategy will be backed by "bold policy reform measures aimed at debt sustainability and improving the socio-economic environment" that include "strengthening financial sector confidence, accelerating the re-engagement process with the international community and revitalising agriculture and the agro-processing value chain".
Part of the strategy document reads, "It also entails advancing beneficiation and/or value addition to the agriculture and mining resource endowment, focusing on infrastructure development, unlocking the potential of small to medium enterprises and improving the investment climate.
"The clearance plan is also anchored on accelerated public enterprises reform and improving public finance management, modernisation of the labour laws and aligning of laws to the Constitution and adhering to the rule of law and the pursuit of an anti-corruption thrust."
Finance Minister Patrick Chinamasa and his information counterpart, Dr Christopher Mushohwe, have already dismissed Mr Corker.
Minister Chinamasa said, "I hope that as he has written this letter, he keeps an open mind with respect to the reality of the situation in Zimbabwe and should not be swayed by distorted information he receives about our country.
"He makes reference to equitable, legal and transparent land reform yet that's basically what we have undertaken. It's much more transparent and equitable than the land tenure system and ownership that existed before the land reform."
Dr Mushohwe weighed in: "The letter dated 28 January, 2016, by Bob Corker, chairman of the US Senate Committee on Foreign Relations, to the US Secretary of the Treasury, Jacob Lew, concerning Zimbabwe's efforts at clearing her arrears and securing new lines of credit from the International Monetary Fund, World Bank, and the African Development Bank once again reveals and confirms US attempts at gross interference in the internal politics of our country, Zimbabwe, contrary to norms of international relations. "Much worse, it reveals US control of what are supposed to be international financial institutions, including seeking to turn regime change in independent-minded African countries like Zimbabwe.
"The statement leaves no one in doubt about the reality of country sanctions, contrary to claims that these are targeted, or that Zimbabwe is being denied lines of credit for failing to service its arrears.
"What lies at the heart of the US foreign policy towards Zimbabwe, is the vain hope for regime change through sanctions-aggravated social conditions, which the US hopes will benefit the opposition.
"The ultimate objective is to reverse the land reform and to weaken Zimbabwe's status as a sovereign, independent African state."
Source - sundaymail
