Zimbabwe Hit With Penalties Totalling US$2.1 Billion For Unsettled Debts
International creditors and banks have hit Zimbabwe with penalties totalling US$2.1 billion for unsettled debts.
Zimbabwe’s total public and publicly guaranteed (PPG) external debt was estimated to be US$14.04 billion during the period, the Standard reported citing a report prepared by the Zimbabwe Public Debt Management Office.
Read the report titled “Statement of Zimbabwe’s Public Debt Position as at end September 2022”:
The external debt overhang continues to weigh down heavily on the country’s development efforts, as access to external financing remains very limited due to the accumulation of external debt arrears.
Of the total PPG external debt of US$8,3 billion excluding Reserve Bank of Zimbabwe (RBZ) debt and blocked funds, principal and interest arrears and penalties represent 76% (US$6,3 billion).
HOT DEALS:
itel A70 - (128GB, 3GB RAM) $89,
itel A70 - (256GB, 4GB RAM) $99
itel P40 (128GB, 4GB), (6000mAh) $99
itel P40 (64GB, 4G), (6000mAh) $93
Cash on Delivery in Harare & Bulawayo. Tinotumira kwamuri inosvika.WhatsApp: 0783 450 793
The bulk of the PPG external debt stock (excluding RBZ external debt and blocked funds), is made up of principal arrears —US$2,7 billion, interest arrears — US$1,6 billion and penalties — US$2,1 billion.
The debt office said Zimbabwe’s external debt was made up of:
a). US$3.4 billion in the RBZ unsettled commitments,
b). US$3.4 billion in bilateral debt
c). US$2.3 billion in blocked funds and
d). US$5.7 billion in multilateral debt.
Of the overall bilateral external debt of US$5.7 billion, debts to the Paris Club amounted to US$3.6 billion while non-Paris Club creditors were owed US$2.2 billion at the end of September.
Arrears in principal, interest, and penalties are nearly equal to the country’s ZW$4.5 trillion (US$6.7 billion) 2023 national budget.
In order to pay off its PPG foreign debt, the government has made payments of about US$114.7 million, which indicates that it will take some time before the nation can fully discharge its debt.
The government says it started making token payments to the World Bank Group in March 2021 and the total amount of these payments is US$66.9 million.
So far, Zimbabwe has paid the African Development Bank Group US$35.4 million and US$4,35 million to the European Investment Bank.
In 2021, the government also began making quarterly symbolic payments totalling US$100 000 to each of the 16 Paris Club bilateral creditors.
A total of US$8 million has been paid to the Paris Club creditors so far.
Finance and Economic Development minister Mthuli Ncube says the external debt overhang continued to hamper the nation’s development efforts.
The country’s domestic and external debt is estimated at about US$17 billion.
