South Africa confirmed on Tuesday that talks with Zimbabwe are continuing on possible loan assistance to its troubled northern neighbour.
”We have not broken off discussions,” National Treasury spokesperson Logan Wort said in Pretoria. ”Zimbabwe has not rejected assistance.”
The fact that Zimbabwe managed to raise the funds to pay $120-million (about R768-million) towards its International Monetary Fund arrears does not change the fact that it needs financial help, Wort said.
Other assistance required includes the immediate alleviation of food shortages and funding for agricultural inputs ”so the country can have food next year”.
The talks are focusing in large part on Zimbabwean plans for the restructuring of its economy. Previous indications were that the assistance was likely to come in the form of a loan and grants.
Wort could not say how much money is involved.
Recent estimations of about $400-million would now in all likelihood exclude the money already paid to the IMF.
There was no indication of when the talks will be concluded.
”I cannot confirm when the next meeting will be,” Wort said.
Minister of Finance Trevor Manuel and South African Reserve Bank Governor Tito Mboweni have been involved in the discussions with their Zimbabwean counterparts.
Neither the South African Reserve Bank nor the Government Communication and Information System was prepared to comment on Tuesday.
Earlier, the Zimbabwean Herald Online quoted that country’s central bank Governor Gideon Sono as saying talks on assistance from South Africa were ongoing.
”As the central bank, we are looking forward to the conclusion of the negotiations that will replenish our coffers accordingly,” Gono said.
”The assistance from South Africa is in the form of a loan, which will have to be repaid at some stage in the future from our mineral, agricultural, tourism and manufacturing exports.”
Gono said most of Zimbabwe’s payment to the IMF came from banks in New York and London.
The funds had been sourced from export proceeds, free funds and foreign-currency liquidations, he said.
Recent reports have said the IMF intended verifying the origin of the money.
Gono gave details of the sources of the funds to IMF directors in Washington on the eve of a September 9 executive board meeting to decide on Zimbabwe’s fate.
Of the funds, $90-million was paid through the Federal Reserve Bank of New York, with the balance being transacted through Absa bank of South Africa.
Zimbabwe reduced its arrears with the IMF to $175-million with last month’s payment. This swayed the majority of the IMF’s executive directors to vote against the country’s expulsion and grant it a six-month reprieve.
Gono said it was unfortunate that some quarters felt offended by Zimbabwe’s ability to pay part of its arrears from its own resources.
”The fact that we surprised everyone with the payment should not in itself cast doubt on our creativity and ability as the central bank and, indeed, the nation’s resolve to take sacrificial measures in the wake of threats to national interests.”
Gono made an undertaking to clear the arrears by November next year. — Sapa