The ManicaPost
The African Export-Import Bank (Afreximbank), which this week extended a $1,5 billion economic stabilisation fund to the Government of Zimbabwe, should be commended for distinguishing itself as an all-weather friend. Afreximbank has been the only international lender that stood by Zimbabwe throughout the challenging times. But its quick announcement of a fresh package of loans is no doubt a vote of confidence in President Mnangagwa’s new Government.
Indeed, the Cairo-based international bank has been the major funder of Zimbabwe while the country was cut off from the International Monetary Fund and World Bank for having defaulted on its debt in 1999. The $1,5 billion facility could not have come at a more appropriate time as funding is what Zimbabwe needs largely, especially on the back of the new political and economic dispensation, which has seen Finance and Economic Development Minister Patrick Chinamasa tabling a prudent economic roadmap in his 2018 Budget Statement.
This is happening on the back of a solid confidence building foundation laid by President Mnangagwa in his inaugural speech, in which he promised a number of policy changes aimed at bringing sanity in the country. Chief among these were the need to attract both local and foreign investment and reforming the way of doing business.
The President’s speech, which wooed not only Zimbabweans but also the international community, was followed up by walking the talk. In walking the talk the new administration has a leaner Cabinet and has presented a positive Budget, which has instilled confidence, and ease of doing business will continue to be one of President Mnangagwa’s top priorities.
The Cabinet rejig has been carefully strategised with an aim to impart fresh impetus to the country’s development process. Overall, the direction of the reshuffled Cabinet inspires confidence that the path of reforms and timely implementation will continue to be top priority. We believe Zimbabwe has struck the right chord and will fit well in Afreximbank’s current strategy, which focuses on intra-African trade; industralisation and export development; and trade finance leadership.
The $1,5 billion facility should therefore enable the country to bridge the significant financing gap confronting the productive sector, particularly the manufacturing industry, which requires funding for retooling and importation of key raw materials. It is our utmost hope that this timely response to the exceptional circumstances that demanded urgent and decisive large-scale support should ensure that Zimbabwe’s productive sector is back on the rails.
We look forward to start seeing Zimbabwe drawing from the stabilisation fund to cover fertiliser manufacturing firms, where an acute shortage of fertilisers is impacting on the farming season. Other industries that need urgent attention include cooking oil companies, fuel importers and the mining sector, which needs new equipment.
We trust that other international financial institutions will take a cue from Afreximbank and extend similar funding facilities that will go a long way in helping transform the country’s economy and create the much
