TUESDAY, 10.00AM:
ZIMBABWE’S Finance Minister Herbert Murerwa says a programme to find Z$5 billion to pay war pensions to former guerrillas has been put to an International Monetary Fund team visiting the country.
A high-powered IMF delegation to Zimbabwe wants the Mugabe government to provide a plan for paying off the guerrillas — whose militancy has become the government’s chief political liability — without blowing the current budget.
The IMF has refused to resume its budget support of Zimbabwe, worth US$62,5 million, but Murerwa said after his meeting that the world body should now have “no reason to refuse” to support Zimbabwe.
The amount pledged to the guerrillas is almost equal to what the goverment raises in a year from personal income taxes. Zimbabwe has not had an IMF-sanctioned economic policy for two years, but needs the IMF because its foreign reserves have dropped so low. The Reserve Bank said on Monday that reserves are at 2,5 months.
Murerwa also announced a set of stringent controls, including a bar on commercial banks holding more than US$5m in foreign currency balances. The government accuses the commercial banks of precipitating last week’s Zimbabwe currency crisis by using liberalised forex laws to speculate rather than fund development. The banks will be obliged to offload US$160 million on to the market, which the government believes will make it unneccesary for the Reserve Bank to intervene further.