Finance and Economic Development Minister Professor Mthuli Ncube is set to leave for the United States of America next month to appraise that country’s government officials on positive developments the country has achieved in recent months.
The engagements are expected to play a pivotal role in convincing the US to lift the ruinous two decades old economic sanctions imposed on the country under the Zimbabwe Democracy and Economic Recovery (Amendment) Act.
Zidera was initially signed into law by former President George W. Bush in December 2001, but had its amendments signed by current President Donald Trump in August last year.
Devastating effects of the Sanctions
The law, which opposition politicians and the civic society campaigned for and are still lobbying the US government to retain, empowers Washington’s representatives in multilateral financial institutions such as the World Bank to vote against the extension of any financial support to Harare, among other constraints.
The economic sanctions, which are said to be targeted at senior Government officials by players in opposition politics, civic society and non-governmental organisations, have seen the country losing at least 80 lines of credit.
Prof Ncube told The Sunday Mail Business in an exclusive interview on the sidelines of his presentation to students of the Defence Course Intake 7 of 2018, at the Zimbabwe National Defence College in Mazowe last Thursday, that sanctions under Zidera, together with the absence of an acceptable arrears clearance plan, have caused the country to lose credit lines.
He said it was imperative for the country to obtain these through local banks, to support the productive sectors of the economy, which makes a strong case for Zidera to be removed.
Said Prof Ncube: “We have lost about 80 credit lines over time, because of Zidera and also because of the arrears clearance. So the two have contributed to the loss.”
He said he needed time to quantify the extent of the loss of the 80 credit lines.
Some researchers have suggested that Zimbabwe has lost donor support amounting to about US$36 million per annum since 2001; US$79 million in loans from the IMF; the World Bank and AfDB; commercial loans of US$431 million and GDP reduction of US$3,4 billion.
Government research has revealed the sanctions could have cost the country over $42 billion in lost investment opportunities, hence the call for their immediate removal.
Arrears Clearance Strategy
Harare is now making frantic efforts to see through the current arrears clearance plan, which was accepted by multilateral financial institutions in Bali, Indonesia in October last year.
In a bid to have Zidera rescinded, Prof Ncube said he had already submitted a report to US government officials, detailing the country’s reform programme that is enunciated in the economic blueprint, the Transitional Stabilisation Programme (TSP).
The TSP has since been accepted by key global economic players as the panacea to the country’s challenges if implemented in its entirety.
Prof Ncube said the envisaged trip to Washington next month or early April, is aimed at updating them on the progress made so far, and potentially, explore how sanctions could be removed to spur the country’s economy.
“Early December last year, we had that hearing on Zimbabwe and I submitted a report to the Foreign Relations Senate Committee on our reform agenda,” said Prof Ncube.
“We have done that (and) now we follow that up with a visit, of course, so we will be able to do that in March or early April. This is to engage, to explain what we are doing.
“We hope that will contribute actually to the lifting of Zidera. And we are also aware that this is a process.”