Germany invites Zimbabwe delegation to Berlin for debt talks

The Government will send a technical team to Germany in the near future to discuss the country's debt to the European country and ways on resolving it.

The country owes international financial institutions approximately $7,3 billion with about $3,7 billion due to the Paris Club and non-Paris club creditors and the remaining $2,6 billion to the World Bank, African Development Bank, EIB and IMF.

Germany is the country's largest creditor in the Paris Club being owed $739 million. Addressing journalists after meeting Germany's regional director for sub-Saharan Africa and the Sahel Georg Schmidt, Finance minister Patrick Chinamasa said the trip to Berlin was at the Germans' invitation.

"We will engage and have dialogue so that we can sort out what needs to be sorted out in our relationship and that is what we have primarily agreed. We have also agreed that they are going to invite us to visit Berlin. Initially we will send technical people to visit the ministry of finance in Germany to talk about the debt, to talk about our economic relationship and how we can move it forward," he said.

Minister Chinamasa said the government is also committed to maintain the rule of law and make the country more attractive to future investors.

"The rule of law is very important in any legal system, it means that things become predictable. As we try to woo investors to come back, they will come into a system that is predictable, into a frame work where they can have recourse into the law and find remedies. And we will work very strongly to achieve that end," he said. Ambassador Schmidt, who is in the country to attend a two day conference organised by German think tanks on the rule of law and the implementation of a constitution said Germany was open to discussions on the Zimbabwean debt.

He said the debt problem is however complicated because it involves a multi-lateral and bi-lateral dimension.

"The multi-lateral dimension is that we are part of the Paris Club so whatever we do, we have to coordinate very closely with our other partners in the Paris club," he said.

He also said Germany has been following the IMF's mission to Zimbabwe closely. He said the success of the Staff Monitored Programme will be an important aspect in dealing with the bilateral debt.

"So we encourage close co-operation with the IMF and in the future with other financial institutions which is also one of the main conditions for us, then to also engage in the bilateral debt talks. So the idea of sit- ting down and talking is always an important one in an open spirit to see where we are going from here," he said.

Schmidt said the rule of law is important in economic terms because the first thing foreign investors look into before they engage is (if there is a problem) the dispute settlement, the terms and conditions that they come under.

"So the general framework and the rule of law is one critical factor for people from the private sector to actually get involved in the Zimbabwean economy and it's upon the initiative of the Zimbabwean government that can regulate and actually create the conditions and the framework and Zimbabwe a country that has a lot to offer can actually attract foreign investment," he added.

The IMF recently said there will not be any funds released to Zimbabwe until the country pays its arrears to the World Bank and there is a consensus among members of the Paris club on whether or not to give Zimbabwe funding.