Imf,amerikkka,europe stranglehold in zimbabwe

[kweku, afro olmec]

ECONOMY: Zimbabwe Can’t Repay Loans; Insisting on Debt Strategy

Stanley Kwenda

HARARE Jul 6 (IPS) - The Zimbabwean coalition government
cannot afford to repay debts incurred when President Robert
Mugabe’s ZANU-PF was ruling on its own and will not repay those
debts.

Zimbabwe’s finance minister Tendai Biti told debt cancellation
campaigners at a conference that Zimbabwe does not have the
capacity to pay the debt and we will not pay this debt.

The minister was responding to growing calls from civil society
organisations for a comprehensive debt audit. The organisations
want the audit to determine the extent to which the country’s
debts have become illegitimate and odious.

Debt becomes illegitimate when contracted by corrupt
governments outside legal frameworks and when there is no public
consultation. Debts become odious if they are not used to benefit
the citizenry but rather to oppress them.

Civil society groups have demanded to know how the money was
used before the debts are repaid.

Biti was speaking at a conference with the theme Economy in
Transition - Towards Sustainable Public Debt for Zimbabwe
hosted by the Zimbabwe Coalition on Debt and Development
(ZIMCODD) in Harare last week. ZIMCODD is a socio-economic
justice coalition established in 2000 to facilitate citizens’
involvement in making public policy and practice pro-people.

According to the latest ministry of finance and Reserve Bank of
Zimbabwe statistics released on Jun 30 Zimbabwe is sitting on
a total external debt of 46 billion dollars. Approximately 65
percent of these external obligations are in arrears.

To compound matters Zimbabwe requires 84 billion dollars for
its Short Term Emergency Recovery Programme (STERP) an economic
blueprint launched by the government in April this year.

The huge external debt may extinguish whatever possibility
exists of an economic recovery. Although the country is starting
to register slight improvement in general economic performance
the huge debt stock remains an impediment.

Revenue collections have steadily risen from 47 million
dollars in January to 287 million dollars in February climbing
further to 417 million dollars in March. The upward trend
continued in April and May when 516 and 668 million dollars was
collected respectively. These amounts are however a drop in the
ocean considering the huge recovery work that the country needs.

The country’s industrial base still operates at 20 percent
capacity while hospitals remain without essential equipment and
medicine. The International Labour Organisation (ILO) puts the
unemployment rate at 95 percent a reflection of an economy which
is far from ticking.

Against this background Biti told the conference that it would
be an ‘‘obscene’’ act for him to attempt repayment of debt.

He reiterated this in an interview with IPS: It would be
obscene for me as the minister of finance to direct that we pay
when 90 percent of our people are living below the poverty datum
line surviving on less than 20 dollar cents a day.

The international financial institutions (IFIs) the
International Monetary Fund (IMF) and the World Bank have
demanded the repayment of past loans before new lines of credit
can be opened.

Biti responded that this kind of approach will only leave
Zimbabwe with a debt overhang. He suggested the formulation of
a sustainable debt strategy which will enable the country to meet
its obligations without abandoning national development.

It is this debt strategy which will form the basis upon which
government will re-engage the international capital market
players Biti told IPS.

Biti further argued that Zimbabwe’s economic indicators now
reflect that of a low income country and therefore Zimbabwe
should qualify for the Heavily Indebted Poor Countries Initiative
(HIPC). Countries that fall under the classification of HIPC
benefit from exceptional arrears clearance support from the IFIs
and the African Development Bank (ADB).

The civil society groups are arguing that the colossal debt
that the country has accumulated is largely illegitimate. An
example is the decision by the ZANU-PF government to send
soldiers into the Democratic Republic of Congo (DRC) an
unbudgeted expenditure.

In the book Zimbabwe‘s Plunge – Neo-Colonialism and Exhausted
Nationalism Patrick Bond and Masimba Manyanya wrote that
Zimbabwe was using one million dollars a day to fight in the DRC.

Dakarayi Matanga ZIMCODD director told IPS that it is
important to determine the legitimacy of public debt because it
affects the realisation of people’s social and economic rights.
We should analyse the legitimacy of the debt in order to
separate what ought to be paid and what not. Public debt is one
of the major hindrances to the realisation of sustainable
development argued Matanga.

Countries spend huge amounts of national resources servicing
debt at the expense of development projects and the provision of
basic services such as health and education he added.

Debt cancellation campaigner Sarah Bracking a senior lecturer
at the University of Manchester’s School of Environment and
Development argued for a debt audit. The Zimbabwean debt is
politically related. Citizens did not take part when decisions to
contract loans were made Bracking told IPS.

Betty Nyamupinga a ZIMCODD debt campaigner indicated to IPS
that the debt audit should have a gender dimension. Let’s look
at the impact of debt on gender. It is us women who are supposed
to take children to hospital and give birth in a dilapidated
facility but when decisions are made we are not consulted
Nyamupinga stated.

Vitalis Meja of the African Forum on Debt and Development
(AFRODAD) called for the total cancellation of debt. Let’s
cancel the damn debt. (Repayment) is like being given a rope to
go and hang yourself and you do just that said Meja.

Obert Gutu a senator in the Zimbabwe parliament speaking in
his own capacity declared that by asking for loan payments the
IFIs are issuing a death warrant for Zimbabweans: They are
simply saying ‘we want you to die’.

[liongod]

very important article kewku.
i read a couple of months ago about zimbabwe's and some of western afrika (co't d'ivore, ghana kwk) rise in european and international tourism and i'd hope that would at least help pull them out of what is said to be one of the highest fastest hikes in inflation (1 zimbabwe dollar equal like 1000 us dollars), but it seems the IMF wants to make another victim, like jamaica, out of zimbabwe. it seems to me like they set a trap over the past 10 years (much like the US CIA did the CONGO or D.R.C.)either the country goes bankrupt fighting a foreign invasion funded by another greedy country or they loose money in trade through the IMF free trade agreement. in this free trade agreement they tend to send genetically modified inferior food from the US and make it cheaper than the food produced in the impoverished country through government subsidies (payed for by the US Middle CLass).
Zimbabwe seems to be going through the same motions as jamiaca were they will be forced to keep going into to further and further debt year after year as a country due to 'extenguishing circumstances'.
The IMF is destroying all third world countries especially black ones, in my opinion, becuase they know the black ones have the most potential to be powerful or revolt. I find it more than ironic that the IMF banking consoritum call in thier debts at the worst time possible in the countries debt reconciliation process. not only is Bush and the US CIA responsible for the destroying the governments of most of the third world countries in the world;but Bush JR is responsoble for the formation of the IMF which had lead to the downfall of these beautfiul countries, built by Afrikans under colonial rule (Haiti, Jamica, Venezuela, kwk) it is sad situation and hard not hate the ones resonsible but justice will be served BY ANY MEANS NECESSARY!. UHURU SASA!