Zimbabwe is facing billions of dollars in foreign debt while internal debt has risen to the highest figure since independence from Britain in 1980, its central bank said on Thursday.
Statistics by the Reserve Bank of Zimbabwe showed that the crises-hit Southern African country owed $3,9-billion against export receipts, while internal debt rose to $208-million.
The results, published in the bank’s Monthly Review bulletin, came as Zimbabwe closed its accounts book for 2005, with its shrinking economy facing inflation touching 1 200% and foreign exchange and fuel shortages.
External debt translated to 134% of the country’s gross domestic product, the central bank said, while pointing out that cumulative government revenue remained below target.
”The revenue and expenditure developments resulted in a budget deficit of Z$1 586-billion for the month [January] under review,” the bank said in its February report.
The Southern African country’s economy has contracted by more than a third over the past seven years.
Unemployment is standing at about 70%, although Harare insists that only 9% of workers don’t have jobs.
Once the breadbasket of Southern Africa, the country of 13-million is seen to be spiralling into economic meltdown, blamed in part by critics on Harare’s controversial land reform programme.
President Robert Mugabe’s government, however, fingers drought and sanctions applied by the European Union and the United States for the country’s economic decline.
Zimbabwe’s relations with the West have been tense since the government launched its land reforms six years ago, seizing farms from about 4 000 white farmers for redistribution to landless blacks.
State radio on Thursday quoted central bank Governor Gideon Gono as saying the economy was set for a dramatic recovery over the next two to three years on the back of an expected mining and commercial farming upturn.
Zimbabwe has been battling to service its debts over the past six years, which in 2004 resulted in a final warning by the International Monetary Fund.
In September last year, Zimbabwe repaid more than a third of its $300-million debt to the global lender, thus automatically surviving expulsion.
The country in April unveiled a nine-month programme to revive its moribund economy.
It is hoped the new economic blueprint, called the National Economic Development Priority Programme, will see Zimbabwe emerge from its economic troubles within six to nine months. — Sapa-AFP