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Finance Minister Ncube said the country's external debt continues to burden the economy by restricting access to low-cost, long-term financing.
The Zimbabwean government said Thursday it will soon host a high-level debt resolution forum with development partners and other stakeholders aimed at building consensus among stakeholders on resolving the country's external debt.
Presenting the 2022 mid-term budget review and supplementary budget speech in parliament, Finance Minister Mthuli Ncube said the country's external debt continues to burden the economy by restricting access to low-cost, long-term financing required to support the desired medium- to long-term growth trajectory.
"To address this challenge, the government has developed the Arrears Clearance, Debt Relief and Restructuring (ACDRR) Strategy aimed at restoring debt sustainability," Ncube said, adding that the African Development Bank President Akinwumi Adesina has agreed to be Zimbabwe's champion for the debt resolution and re-engagement process.
"In his capacity as champion, he will coordinate and chair the forthcoming high-level debt resolution forum," Ncube said.
#IMF July update: global growth down, inflation up, debt vulnerabilities up… and the situation will be worst for developing countries.. A plausible alternative scenario tends to a global growth decline to about 2.6% and 2% in 2022 and 2023.. more pain ahead! #economy#inflationpic.twitter.com/TpgkFJOinn
Adesina visited Zimbabwe this month to reaffirm his commitment to helping Zimbabwe clear its long-standing debt. He met Zimbabwe's President Emmerson Mnangagwa, Finance Minister Mthuli Ncube and representatives of international financial institutions (IFIs).
Zimbabwe has huge external debt arrears amounting to US$13.2 billion. This African country has tried unsuccessfully in the past to clear its huge external debt arrears through various strategies, with the last debt arrears clearance plan, dubbed the Lima plan agreed with global lenders in Peru in 2015, to no avail.
The Zimbabwean government has since drawn up a new arrears clearance strategy that it hopes will succeed with the help of the AfDB president. In 2015 and under the Lima plan, Zimbabwe cleared its 15-year debt arrears to the International Monetary Fund (IMF) amounting to US$108 million, but this has not moved the IMF to release new loans to Zimbabwe, arguing it has to clear arrears with other IFIs and bilateral creditors and also implements a strong reform agenda.