Zimbabwe receives $210m in foreign loans for projects

The southern African nation has $9bn in foreign debt.

Zimbabwe’s government received $210 million in foreign loans for various infrastructure projects during the first half of the year, the central bank said on Wednesday.

Reserve Bank of Zimbabwe Governor John Mangudya said in a monetary policy statement the central bank had negotiated with African lenders such as the PTA Bank, the African Export-Import Bank well as the Development Bank of Belarus.

The World Bank, International Monetary Fund and other Western donors have withheld support to Zimbabwe since 1999 and the southern African nation has $9 billion in foreign debt.

Zimbabwe’s economy is expected to grow at a slower rate of 1.5% due to a drought that reduced agriculture output and low metal prices that have hit earnings from mining, but Mangudya projected a faster growth of 3.5% in 2016.

Zimbabwe faces electricity shortages and slow foreign investment, while its industries are battling cheaper imports from South Africa and China, its two main trading partners.

Companies also complain about the high cost of money, which has seen most businesses default on their loans.

Mangudya said a state-owned management company had taken over $157 million in bad debts from banks and was working to take a further $58 million in debts by the end of September.

Interest rates average 20% in Zimbabwe but Mangudya said the central bank had agreed with banks that starting from October, the lenders would charge interest rates of between 6% and 18%, depending with the credit risk.

Mangudya said inflation was expected to remain at sub-zero levels this year due to depressed demand and low oil prices.

Gold mines delivered 8 tonnes during the first half of the year and at current trends, deliveries would reach 16 tonnes by year-end from 13.9 tonnes a year ago, said Mangudya.

VIDEOS

COMMENTS   0

You must be signed in and an Insider Gold subscriber to comment.

SUBSCRIBE NOW SIGN IN

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

Podcasts

INSIDER SUBSCRIPTION APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING

Follow us:

Search Articles:
Click a Company: