Zimbabwe eyes deal with multilateral lenders by end of 2016

Zimbabwe is looking forward to get its proposal to clear debt arrears with multilateral lenders signed off by the end of this year.

This will enable the country to commence talks with a number of bilateral sovereign lenders, the country’s finance minister, Patrick Chinamasa, said on Monday.

“We are looking forward to three multilateral lenders to formally adopt our debt clearance strategy when they meet in December,” he told Reuters.

Zimbabwe’s foreign debt stands at $8.3 billion out of which $1.8 billion is in arrears and it is one of the few countries in arrears with the International Monetary Fund (IMF).

#Zimbabwe finance minister and CB governor in London trying to drum up investor interest on back of planned IMF deal https://t.co/YCZWDj4soX

— Charlie Robertson (@RencapMan) July 5, 2016

However, it remains unclear whether the lenders will approve the proposals. If approved, this could open doors to possible new funding since 1999.

Currently, the southern Africa economy is facing a cash crunch which shows no signs of abating, prompting strikes by civil servants in the country.

#Zimbabwe Government Workers Union Calls Immediate Strike https://t.co/cHgjqxqlmG

— Bloomberg Africa (@BBGAfrica) July 5, 2016

Without balance of payment support from the IMF and credit from traditional western lenders, the country has been forced to run a hand-to- mouth budget, spending 82 percent of its revenue on wages, which it is struggling to pay.

The economic crisis in the country stems from years of international isolation largely blamed on president Robert Mugabe’s land policy seizures executed in the early 2000s.