World Bank finalises funding for Zim

THE World Bank is concluding funding requirements for Zimbabwe as part of processes to start lending to the southern African country, Finance and Economic Planning Minister Patrick Chinamasa has said.

Zimbabwe is in arrears of $1,2 billion to the World Bank and has already mobilised the funds to pay off its arrears.

However, the Government first wanted a commitment from the Bretton Woods institution on the loans that it could access after paying.

The Zimbabwean Government had since 1999 been unable to borrow from the international capital markets after it defaulted on its external debt.

While the country in 2016 cleared its arrears to the International Monetary Fund (IMF), it is still in arrears of $1,8 billion to the World Bank and the African Development Bank.

Minister Chinamasa told The Herald Business that Government had arranged a commercial loan to retire the arrears.

“What we said is before we pay you (WB), what expectations can we have in terms of new inflows as per our entitlement as a member, as a shareholder,” said Minister Chinamasa.

“They have been non-committal. Except now; they agreed since January to do a needs assessment, sector by sector, in order to determine and assess what are our needs per sector. What we need in terms of investment into agriculture, manufacturing, mining, tourism.

“The exercise in nearly complete. That is the exercise, which when concluded will inform the World Bank the amount of new inflows that we can draw on from the World Bank.”

The arrears have prevented Zimbabwe from accessing the global markets in terms of line of credit of around $4 and $5 billion annually, according to the minister.

Meanwhile, Zimbabwe’s economy is likely to grow faster that initially projected, largely driven by mining and agriculture.

Minister Chinamasa said on Tuesday the economy would expand 6 percent in 2018, faster than previous forecast of 4,5 percent.

The World Bank has in its latest forecast revised upwards Zimbabwe’s gross domestic product to 2,7 percent from 1,8 percent it had projected in January this year.

“We projected an economic growth of 4,5 percent this year and I believe that projection figure was on the conservative side,” said Minister Chinamasa. “We should easily hit 6 percent.” He said a number of investments, which could not take off largely due to concerns around indigenisation and empowerment laws under the administration of former President Robert Mugabe were now being implemented.

Some Chinese energy projects, which had been stifled by non-payment of arrears by the Government to the China Export and Credit Insurance Corporation were taking off.

China Export and Credit Insurance Corporation is a state-funded policy-oriented insurance company that promotes China’s foreign

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