Africa

IMF eases restrictions on help for Zimbabwe

Sapa-AFP

The IMF has relaxed restrictions on supporting Zimbabwe as the country moves toward constitutional reform and shows improvement in cooperation.

Zimbabwe President Robert Mugabe. (Gallo)

The International Monetary Fund (IMF) said easing its restrictions, set after Zimbabwe fell behind in repayments to the fund, would allow its staff to advise the government on its economic program and monitor the program's implementation.

The IMF's executive said it took the decision based on "significant improvement in Zimbabwe's cooperation on economic policies" and the government's renewed commitment to deal with its arrears problems.

It also cited the threat to Zimbabwe's economic stabilisation program from "severe capacity constraints" in areas that the IMF would be able to provide help.

Zimbabwe has been behind in the repayment of $132-million owed to the IMF since 2001; it is also in default on another $1.5-billion owed to the World Bank and African Development Bank, according to a June 2012 IMF report.

In a September report, the IMF said Zimbabwe's government had begun cooperating more closely in discussions on its outstanding debt, including making a new commitment to repay the money.

The IMF said on Tuesday that the eased restrictions would allow it to expand its technical assistance to the country "to support Zimbabwe's formulation and implementation of a comprehensive adjustment and structural reform program that can be monitored by the staff."

No financial assistance is involved, the IMF stressed.

The move comes as Zimbabwe's economic situation, precarious in recent years, is stabilising and the government commits to reforms.

Earlier on Tuesday, President Robert Mugabe said he expects fresh elections early next year, held under a new Constitution, to choose a successor to the country's shaky power-sharing government.

Last week, political parties and civic groups gathered to review the draft Constitution that will be put to a referendum. The date of the referendum has yet to be announced. – Sapa-AFP

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