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🇿🇼 Zimbabwe /Economy & Trade

Zimbabwe Seeking $150 Million AfDB Loan to Tackle Debt Default

From AllAfrica Zimbabwe · () English

Summarized and contextualized by DistantNews.

At a glance

News Named sources Ongoing story
  • Zimbabwe is negotiating with the African Development Bank for a $150 million loan to help clear its debt arrears.
  • The country owes approximately $23 billion and has been excluded from international capital markets since 1999.
  • Clearing these arrears is considered a crucial step for Zimbabwe to access necessary development financing.

Zimbabwe is actively seeking a $150 million loan from the African Development Bank (AfDB) as part of a broader strategy to address its substantial debt arrears. Finance Minister Mthuli Ncube confirmed the ongoing discussions, which are crucial for the southern African nation's re-engagement with international financial institutions.

Zimbabwe has been unable to access international capital markets since 1999 due to defaults on its loans, accumulating an estimated $23 billion in debt. The government is pursuing a multi-pronged approach, also engaging with countries like the UK, Japan, and Germany to raise an additional $2.5 billion. The AfDB's Transition Support Facility is specifically designed to assist eligible countries in clearing their debt backlogs and normalizing relationships with creditors.

The AfDB remains Zimbabwe's lead partner in the arrears clearance process and is playing a catalytic role in supporting the country's re-engagement with the international financial community.

— Eyerusalem FasikaThe AfDB's country director for Zimbabwe highlighted the bank's pivotal role in the country's financial recovery efforts.

Eyerusalem Fasika, the AfDB's country director for Zimbabwe, emphasized the bank's leading role in this process. "The AfDB remains Zimbabwe's lead partner in the arrears clearance process and is playing a catalytic role in supporting the country's re-engagement with the international financial community," Fasika stated. She added that "Clearing arrears is the gateway to unlocking the development financing the country urgently needs."

This initiative follows a recent development in February when Zimbabwe secured a staff-monitored program from the International Monetary Fund (IMF). The finance ministry described this as a "key step" toward resolving its financial obligations. The ministry also reported that Ncube briefed an IMF delegation on economic progress and efforts to secure bridge financing, with both parties reaffirming their commitment to economic stability, fiscal discipline, and international re-engagement.

Clearing arrears is the gateway to unlocking the development financing the country urgently needs.

— Eyerusalem FasikaThe AfDB's country director for Zimbabwe explained the significance of resolving debt issues for future development.
DistantNews Editorial

Originally published by AllAfrica Zimbabwe. Summarized and contextualized by our editorial team with added local perspective. Read our editorial standards.

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