One of Zimbabwe’s biggest creditors rejected a government request for debt relief until it improves its human rights record and pays arrears on outstanding debt.
The southern African country’s plea for relief was rebuffed in a June 12 letter to Zimbabwean Finance Minister Mthuli Ncube from Odile Renaud-Basso, chairwoman of the Paris Club. The group, to which Zimbabwe owed $3.26 billion in 2018, represents creditor nations including members of the Organisation for Economic Cooperation and Development.
The letter, seen by Bloomberg, was in response to an April 2 appeal by Ncube to the heads of the International Monetary Fund, World Bank, African Development Bank, Paris Club and European Investment Bank seeking an arrears-clearance program and debt relief. Zimbabwe’s relations with multilateral lenders have been strained for almost 20 years as it failed to meet payments and a series of elections were marred by violence and irregularities.
“Zimbabwe’s desire to normalise its relations with the international community can only advance following the implementation of substantive economic and political reforms,” Renaud-Basso said. The required reforms are “regarding the respect for human rights, especially freedom of assembly and expression,” she said.
Winning debt relief was a key plank of Ncube’s strategy to kickstart the economy after two decades of stagnation. The former Oxford University lecturer’s attempts to drive economic reform and improve relations with lenders have been thwarted by the violent suppression by Zimbabwean security forces of a series of demonstrations.
Schwan Badirou-Gafari, secretary-general of the Paris Club, declined to comment, as did Clive Mphambela, a spokesman for Zimbabwe’s Treasury.
Ncube hasn’t commented on the letter he sent or whether he got any other responses. His appeal comes at a time when the country’s economy is in freefall as a result of economic mismanagement in recent years. It is also trying to recover from the worst drought in four decades, a rare cyclone and the impact of the coronavirus outbreak.
Renaud-Basso said the Paris Club will only re-engage Zimbabwe once its arrears to international financial institutions have been paid and cautioned the country to use the limited amount of aid it has received to combat the Covid-19 outbreak transparently.
In 2018, the last time figures were provided, Zimbabwe had $7.66 billion in external debt.
New Zimbabwe, an Internet website, reported on the letter earlier.
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