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Zimbabwe's Finance Minister in Fresh IMF Loan Bid

Zimbabwe's Finance Minster Patrick Chinamasa.
Zimbabwe's Finance Minster Patrick Chinamasa.

The increasingly desperate Zimbabwe government is expected to make a fresh appeal to the International Monetary Fund for a loan to help resuscitate the country’s ailing economy.

The IMF, which is sending its mission to Harare this week under the staff monitored program (SMP), has insisted that Zimbabwe pays its huge external debt before requesting fresh loans.

The Breton Woods institution has not been extending loans to Harare for over a decade now, following Harare's unplanned land reforms and its failure to pay back huge sums it owes.

But insiders say Finance Minister Patrick Chinamasa has indicated that he will continue to push for IMF funding to try and reboot the tanking economy

In his mid-term fiscal policy review Thursday, Chinamasa said Zimbabwe is saddled with “an unsustainable external debt overhang amounting to US$8.8 billion as at end June 2014”.

Harare and the IMF agreed on the staff monitored program last year. It should have run from April to December 2013. The program has since been extended following disruptions during last year’s electoral period.

The Zanu PF government also pleaded for more time to implement the program following the elections.

Similarly, as a way of normalizing relations, Chinamasa said in his monetary policy that the government will also start making token payments to international financiers.

Efforts to get a comment from Chinamasa about the IMF visit were futile as he did not answer his mobile phone.

But economic consultant John Robertson told VOA that the IMF mission will be disappointed with Harare’s failure to implement agreed polices.

He adds progress has been painfully slow.

“Some things have changed but I’m afraid they have got worse rather than better,” said Robertson.

The staff monitored program requested Harare to reduce government expenditure, reduce the demand that the government was making for its own expenditures, specifically on wages and salaries in government.

“Instead there has been an increase in the amounts being paid and government employment costs have now gone up; it looks like about 80 percent of total expenditure,” said Robertson.