|
Zim Moves Deeper Into Debt Trap
EXTERNAL arrears have ballooned to about US$1,6 billion (about Z$1,3 trillion at the official rate) as Zimbabwe sinks deeper into a debt crisis, The Financial Gazette can reveal. Government arrears constitute the bigger part of the outstanding debt, which has skyrocketed in Zimbabwe dollar terms because of the devaluation. As of July 4, 13 members of the Paris Club were owed US$416.8 million up from US$397.9 million as of June 27. The 13-member states include Austria, Belgium, Finland, France, Germany, Italy, Japan, Netherlands, Norway, Spain, Switzerland, United Kingdom and the United States. Zimbabwe has been failing to service its debts for the past three years because of the shortages of foreign currency. In his last monetary policy statement presented in November last year, out-going Reserve Bank of Zimbabwe governor Leonard Tsumba said external borrowing by government has been mainly to finance on-going projects.
| Like Bob's bank accounts... |
Analysts said the total debt stock would continue to rise because exporters are not generating enough foreign currency to service it. It is, however, in the government's interest not to continue to devalue the local unit to keep a lid on the arrears in Zimbabwe dollar terms. "There is no way the debt would go down. Instead, as a nation we are sinking more into this debt. There is no end in sight," said Best Doroh, a senior economist with the Financial Holdings Limited.
| Not until Bob leaves, anyway... |
Posted by: Fred Pruitt 2003-08-01 |
