News / Local
Mthuli Ncube cornered over US$10m loan deal
06 Mar 2021 at 06:19hrs | Views
GOVERNMENT's insatiable appetite for borrowing has once again come under scrutiny after legislators grilled Finance minister Mthuli Ncube on Thursday over Treasury's decision to borrow US$10 million for COVID-19 programmes at a time it is failing to account for over US$220 million donated for the same cause.
Tempers flared after Ncube disclosed that government was in the process of borrowing US$10 million from the Arab Bank for Economic Development in Africa to fund its COVID-19 intervention programmes.
"The tenure of the loan is 25 years and the government will repay the principal in 40 semi-annual instalments, where the repayments paid within 30 days of the due date will attract a 0,25% discount on the interest rate, so this is attractive, indeed," Ncube said.
He said the loan was meant to complement the current efforts to fight the pandemic and reduce its health, economic and social impact. Peeved MPs took turns to bombard the famed economics professor with questions over accountability and transparency in dealing with COVID-19 donations, saying given the government's record of looting and abuse of public funds, the loan may not be necessary at the moment.
Others also claimed that what the government had received in the form of donations was adequate, hence no need to continue borrowing.
Parliamentary Portfolio committee on Health and Child Care chairperson Ruth Labode said it was illogical for government to borrow before giving a comprehensive breakdown of how donated funds from well-wishers, including the Global Fund, were used.
"I am concerned with our borrowing, especially towards COVID-19. I would have been more comfortable if the minister would have brought a report on all the donations we have received and what they have been used for, specifically regarding COV-ID-19," she said.
Labode questioned how government had used the US$45 million offered by the Global Fund.
"So I am really thinking, as Zimbabweans, we were told immediately after we queried, the ZACC [Zimbabwe Anti-Corruption Commission] reported that there were test kits found in Bulawayo stolen worth US$12 000. Do we want to be borrowing for certain individuals to come and steal?" she asked rhetorically.
"When the ministry reported on drugs, Nat-Pharm [National Pharmaceuticals of Zimbabwe] seemed to have adequate drugs for COVID-19 and I was even worried that they might expire on us. So my concern is what exactly are we going to use this money for? Let us not get ourselves in debt unnecessarily" Norton MP Temba Mliswa (Independent) quizzed Ncube on what government was using as collateral to secure the loan.
Harare North MP Allan Markham (MDC Alliance) demanded a break-down of all donations towards the COVID-19 pandemic, saying there were fears the donations may have been abused.
"I think the minister should give us a reconciliation of all money borrowed in the name of COVID-19 and donated in the name of COVID-19 and what it has been used foe," he said.
MPs demanded that Ncube issue a ministerial statement on how money pledged towards the COVID-19 pandemic was used.
Magwegwe MP Anele Ndebele said: "I remember vividly at some point that the minister allocated an equivalent of US$10 million towards COVID-19 research. It will be interesting for him to break this down as to what research is being undertaken under COVID-19 in our country because I honestly feel that any research that we will be doing is as good as reinventing the wheel."
But Ncube said the loan was "a plain vanilla concessionary loan" and a good deal.
Ncube said over US$220 million had so far been pledged towards fighting the COVID-19 pandemic, but only half of that has been availed.
"Yes, the partners have donated monies towards COVID-19 to the tune of US$220 million, but the release of these resources is at their pace, at their choosing and the time is also in their choosing and these resources, by the way, do not go through our budget. We do not sit here as Parliament to deliberate over it and approve because it is outside the budget," he said.
"The advantage of what we have before us, the US$10m, it looks small but this is a high impact concessional loan Madam Speaker, very high impact in targeting COVID-19. We have control if we need to know the areas where it will be used," he said.
On reconciliation of all the COVID-19 donations, Ncube said: "We cannot give you reconciliation. All I can talk about is telling you how much they have pledged and how much they have given us so far, but I cannot tell you the details because the donors themselves control that."
He said the Global Fund donations included personal protective equipment and other support for COVID-19 and so far, US$17,5 million of the US$45 million pledged has been availed.
Tempers flared after Ncube disclosed that government was in the process of borrowing US$10 million from the Arab Bank for Economic Development in Africa to fund its COVID-19 intervention programmes.
"The tenure of the loan is 25 years and the government will repay the principal in 40 semi-annual instalments, where the repayments paid within 30 days of the due date will attract a 0,25% discount on the interest rate, so this is attractive, indeed," Ncube said.
He said the loan was meant to complement the current efforts to fight the pandemic and reduce its health, economic and social impact. Peeved MPs took turns to bombard the famed economics professor with questions over accountability and transparency in dealing with COVID-19 donations, saying given the government's record of looting and abuse of public funds, the loan may not be necessary at the moment.
Others also claimed that what the government had received in the form of donations was adequate, hence no need to continue borrowing.
Parliamentary Portfolio committee on Health and Child Care chairperson Ruth Labode said it was illogical for government to borrow before giving a comprehensive breakdown of how donated funds from well-wishers, including the Global Fund, were used.
"I am concerned with our borrowing, especially towards COVID-19. I would have been more comfortable if the minister would have brought a report on all the donations we have received and what they have been used for, specifically regarding COV-ID-19," she said.
Labode questioned how government had used the US$45 million offered by the Global Fund.
"So I am really thinking, as Zimbabweans, we were told immediately after we queried, the ZACC [Zimbabwe Anti-Corruption Commission] reported that there were test kits found in Bulawayo stolen worth US$12 000. Do we want to be borrowing for certain individuals to come and steal?" she asked rhetorically.
"When the ministry reported on drugs, Nat-Pharm [National Pharmaceuticals of Zimbabwe] seemed to have adequate drugs for COVID-19 and I was even worried that they might expire on us. So my concern is what exactly are we going to use this money for? Let us not get ourselves in debt unnecessarily" Norton MP Temba Mliswa (Independent) quizzed Ncube on what government was using as collateral to secure the loan.
"I think the minister should give us a reconciliation of all money borrowed in the name of COVID-19 and donated in the name of COVID-19 and what it has been used foe," he said.
MPs demanded that Ncube issue a ministerial statement on how money pledged towards the COVID-19 pandemic was used.
Magwegwe MP Anele Ndebele said: "I remember vividly at some point that the minister allocated an equivalent of US$10 million towards COVID-19 research. It will be interesting for him to break this down as to what research is being undertaken under COVID-19 in our country because I honestly feel that any research that we will be doing is as good as reinventing the wheel."
But Ncube said the loan was "a plain vanilla concessionary loan" and a good deal.
Ncube said over US$220 million had so far been pledged towards fighting the COVID-19 pandemic, but only half of that has been availed.
"Yes, the partners have donated monies towards COVID-19 to the tune of US$220 million, but the release of these resources is at their pace, at their choosing and the time is also in their choosing and these resources, by the way, do not go through our budget. We do not sit here as Parliament to deliberate over it and approve because it is outside the budget," he said.
"The advantage of what we have before us, the US$10m, it looks small but this is a high impact concessional loan Madam Speaker, very high impact in targeting COVID-19. We have control if we need to know the areas where it will be used," he said.
On reconciliation of all the COVID-19 donations, Ncube said: "We cannot give you reconciliation. All I can talk about is telling you how much they have pledged and how much they have given us so far, but I cannot tell you the details because the donors themselves control that."
He said the Global Fund donations included personal protective equipment and other support for COVID-19 and so far, US$17,5 million of the US$45 million pledged has been availed.
Source - newsday
