AfDB says Zimbabwe seeks $2.6bn in bridge finance to overhaul debt

The African Development Bank said Zimbabwe has proposed seeking $2.6 billion in bridge finance to help it clear arrears owed to international financial institutions as it attempts to break a debt impasse dating back to 1999.

The southern African nation owes about 60% of its $21 billion debt pile to external creditors including the World Bank, Paris Club, European Investment Bank and the AfDB. The debt has kept Zimbabwe locked out of global capital markets since it first defaulted on payments a quarter of a century ago.

As part of efforts to renegotiate the debt it has, since 2022, been having discussions with creditors. A meeting on Zimbabwe's arrears clearance and debt resolution process was held on the sidelines of the International Monetary Fund and World Bank spring meetings in Washington this week, the AfDB said said in a statement on Wednesday.

Akinwumi Adesina, the AfDB president and co-negotiator of the debt talks, said in the statement that the next steps will include the need for the IMF to approve a staff-monitored program for Zimbabwe during the spring meetings, support from potential donors for bridge loan financing, exploration of additional resources from the African Development Fund, and prioritization of Zimbabwe's arrears clearance within the G20 Common Framework.

Earlier this week, Zimbabwe's Treasury said it's nearing a deal with the IMF on a programme.