‘Solution to Zim debt crisis requires transparency and inclusivity’ – Biti
Former Finance Minister Tendai Biti has said any engagement to discuss measures to resolve Zimbabwe’s debt crisis needed to be inclusive and transparent for it to be successful.
Biti was commenting on the current meeting being held in Harare by African Development Bank (AfDB) president Akinwumi Adesina and former Mozambique president, Joaquim Chissano, alongside government officials to map out key actions to be taken on Zimbabwe’s debt clearance and arrears.
The country’s public debt, as of September last year, stood at US$17,63 billion as the government continued to incur external loans using commodities as collateral and widened its domestic borrowing through the issuances of debt securities.
From this amount, US$670,76 million was owed to the AfDB.
Biti, an opposition MP for Harare East, however argues that the solution to the crisis requires that government departments especially the Reserve Bank of Zimbabwe (RBZ) and the Ministry of Finance are transparent on the actual amount the country is owing international financial institutions.
He added that the discussion to map the way forward needed to be inclusive by embracing stakeholders from all walks of life.
“The resolution of Zimbabwe’s unsustainable debt burden is a national imperator. We therefore welcome the Akin Adesina-led process. We welcome President Chissano and his high level team.This process offers a genuine opportunity for real dialogue between Zimbabwe and the international community,” Biti said.
“However all parties must understand that Zimbabwe’s debt question can only be resolved by addressing Zimbabwe’s anchor crises, which is its ugly extractive politics. Politics and governance issues remain center of gravity and any debt solution must primarily aim at resolution of decades long political crises.
“An attempt to view the debt crises as a purely economic exercise oblivious to the country’s politics will be mendacious & will in any event ultimately fail. Previous efforts such (Patrick) Chinamasa’s Lima Attempt failed precisely because they sought to delink politics from economics.”
Biti added: “Secondly the process must be transparent and inclusive. Debt is ultimately a burden on the citizens and therefore civic society and political parties can not be excluded from any such process. An elite pact particularly one before a major election will not work.
“Truth is that a process of international engagement not scaffolded by genuine domestic dialogue and conversation amongst domestic actors and held in context of high levels of intolerance, closure of political space, passage of draconian laws, detention of alternative voices stands on quick sand.”
The vice president of the opposition Citizens Coalition for Change (CCC) party said the process must extract long overdue political and economic reforms. He said comprehensive political reforms must be agreed that include electoral and other governance reforms
“The government must show signals of good faith which could include the abandonment of the PVO and Patriotic Bills , the release of political prisoners and cessation of political prosecutions. On the economic front an upper tier SMP must be agreed with the IMF.
“This should have high level quantitative and qualitative targets that must focus on exchange rate and currency reform ,the Central Bank, corruption, budget deficits,quasi fiscal activities, debt contraction, debt ceilings,compensation of currency change losses, PFM reforms,pension reforms etc
“Further it is important that there be full disclosure and audit and verification of Zim s current debt levels. The figure of US$14 b being peddled by the authorities is viciously contested. It does not take into account debt being hidden at the Central Bank and parastatals
“Lastly it is important to have the buy-in ,presence and consensus of every creditor. China is key for its owed a couple of billions. It is therefore a major player. Equally the AfreximBank with a strong presence in this economy needs to be on board .
“Ultimately the success or failure of this process depends on whether or not the regime in Harare is ready for genuine dialogue. Whether or not it is sufficiently united on this process. Put simply are they reformers in this regime? If not are there sufficient incentives for reform?”
Speaking after his arrival in Harare, Dr Adesina said: “I come here with a lot of expectation that we will have a lot of dialogue, a lot of frankness, and a lot of openness.
“I think that we are coming here with a solutions mindset and I am very hopeful that we will get to a pathway that will give solutions for a new Zimbabwe.”
“This is a second meeting in terms of the dialogue we are having on Zimbabwe’s arrears clearance and also debt resolution. So there is a high level of commitment and the Minister of Finance (Prof Ncube) who is doing a fantastic job and all the partners, both multilateral and bilateral, are very strongly committed to this particular process.
“I am delighted that former Mozambique President Chissano is here, who is the facilitator of that process. Of course, I am the champion for this process appointed by His Excellency President Mnangagwa,” he said.