International Monetary Fund member countries agreed unanimously on Friday to restore Zimbabwe's voting rights after a seven-year suspension, a step toward normalising relations with major donors. The IMF said, however, that Zimbabwe was not eligible for financial aid until it had cleared its arrears to the Fund and had a plan to pay off arrears to the World Bank and African Development Bank.
The arrears to the three institutions total about $1.3 billion. In an interview with Reuters, Zimbabwe Finance Minister Tendai Biti said key donors like the United States and Britain made strong statements of support for Zimbabwe during the IMF meeting but want to see more political and economic reforms.
"It's a major indicator that if we continue on the path of reform, on the path of stabilisation, and policy consistencies, we can achieve full reintegration and full support," he said. The IMF suspended Zimbabwe's voting rights in 2003 over policy differences with the previous government of President Robert Mugabe. Western donors withdraw crucial funding for the southern African country and blamed Mugabe's land reform policies and mismanagement for the collapse of the once prosperous economy.
Mugabe formed a unity government a year ago with former opposition leader Morgan Tsvangirai, who is now prime minister. The IMF has said there are signs the economy is starting to recover due to improved policies. Biti said that without addressing Zimbabwe's debt burden of close to $6 billion, including to the Paris Club of creditor nations, the country would be unable to recover fully from more than a decade of economic decline.
In a country where 85 percent of the population lives below the poverty line and per-capita income is less than $400, Biti said it would be "immoral to take any dollar of our meager resources" to pay off our debt.
"It is self-evident that we have to come to an understanding with the creditors and partners on our debt," he added. But to win donor support for debt cancellation, Biti said Zimbabwe had to establish a track record of good economic and political decisions. "(Donors) are preparing to support us but they are also rightfully raising certain issues that we have to deal with," Biti added.
Among those, he said, was a clear signal about the political direction of the country including the credibility of the political coalition, and progress in building a democratic state through agreement on a new constitution and strengthening the rule of law. On the economy, he said donors wanted "clear signs that the economic stabilisation work we have done is not a flash in the pan and is an irreversible commitment." Biti said an IMF team would next visit Zimbabwe in early March.
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