Mthuli Ncube letter to IMF, World bank
The Zimbabwe government has extended their begging bowl to the International Monetary Fund (IMF) and The World Bank among other global financial institutions as it is struggling to deal with the worsening economic crisis resulting from ‘policy’ missteps, drought and covid-19 pandemic.
The development was revealed by a leaked letter that was send by Finance Minister Mthuli Ncube to the IMF, the World Bank and the Paris Club. Mthuli Ncube admitted the economy is would collapse if an urgent financial assistance is not put together for Zimbabwe.
Government expects devastating effects of covid-19
The government expects covid-19 pandemic to have lasting effects in Zimbabwe if an urgent financial assistance package is not availed. Part of the letter read, “The global COVID-19 Pandemic is expected to have a devastating health, humanitarian and economic impact on Zimbabwe.”
Mthuli admits to failed policies, policy missteps
Mthuli Ncube letter to IMF, World bank and the Paris Club revealed the government is facing pressure from lending institutions to implement policy reforms
Mthuli Ncube admitted the government has made policy missteps and is willing to reform in a way of normalising relations with the global lending institutions. He categorised the reforms into political, economic and policy. He did not talk much about the political reforms as he has little control over them. He emphasised the government had made a great achievement on economic reforms but was let down by the covid-19 pandemic and power cuts caused by climate change.
Zimbabwe still owes the World Bank
Mthuli Ncube letter to IMF, World bank and the Paris Club acknowledged Zimbabwe still owes the World bank, but would still want to have its debt restructured or cancelled to enable it to get fresh financing for the looming health and economic crisis
Zimbabwe economy is set to contract
The Finance Minister admitted the economy is set to grow negatively from between 15% to 20% which will leave Zimbabwe at the edge due to the state of the economy at this current moment.
Mthuli says Zimbabwe desperately needs urgent international support despite making little progress on reforms. He went on to talk about the repealing of POSA and its immediate replacement with a similar law in form of AIPPA. He also assured the institutions that the government is currently in the process of calculating the compensation to white farmers affected during the chaotic land reform programme and they should be done by June this year.
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