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Zimbabwe to pay $1.8 billion only when economy is stronger

Staff Writer | September 21, 2017
Zimbabwe’s Finance Minister said the southern African nation would not be able pay $1.8 billion in arrears to the World Bank and African Development Bank (AfDB) until economic fundamentals improve.
Patrick Chinamasa
Africa   Finance Minister:
Patrick Chinamasa said in a radio interview that a payment plan agreed with foreign lenders in 2015 in Lima, Peru, could only proceed once Zimbabwe has reduced its fiscal deficit from around 10 percent of gross domestic product, cut its wage bill from 92 percent of the budget and increased its import cover.

Chinamasa said the government had negotiated a cheaper loan to pay the $1.8 billion but had decided against paying after realising that the country could still remain in a debt cycle if it did not address its economic problems.

He did not give the source of the new loan but said Zimbabwe was paying 15 percent a year on its World Bank loan. Zimbabwe’s total foreign debt is more than $7 billion.