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Zimbabwe public debt – who is owed what?

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Treasury has just released the 2022 public debt bulletin. Zimbabwe is in debt crisis, and last year started a campaign, led by the African Development Bank (AfDB), to push for a debt restructuring deal with its major creditors.

What does the latest report show about the state of Zimbabwe’s debt crisis? Just how much does Zimbabwe owe now? Who does the country owe? Here, we drop some highlights from the debt report.

Total public and publicly guaranteed debt was US$18 billion in December 2022. This is made up of US$12.8 billion of foreign debt and domestic debt of US$5.2 billion. Of the 2022 foreign debt, US$5.89 billion is bilateral debt – money owed to other countries. Multilateral debt – money borrowed from lenders like AfDB and the World Bank – is US$2.7 billion. Most of what Zimbabwe owes these lenders – US$2.47 billion – is arrears and penalties for not paying up. External debt was US$14.4 billion at the end of 2021.

Which multilateral lenders do we owe the most?

  • Zimbabwe’s debt to the World Bank is US$1.546 billion. Arrears are US$1.412, which is 91% of the amount owed.
  • African Development Bank: US$692 million (arrears of US$664 million, 96%)
  • European Investment Bank: US$395 million (arrears and penalties of US$384, 97%).

Zimbabwe owes China US$2.03 billion, mostly used for infrastructure. Many Chinese-funded projects slowed down in 2022 because Zimbabwe was not servicing debts fast enough. Last year, Zimbabwe serviced its Chinese debts more, paying US$18 million to China Eximbank and another US$18 million to Sinosure, which provides export credit insurance to Chinese companies.

These payments unlocked more funding under existing facilities in 2022. Zimbabwe got US$156.73 million to complete the new units at the Hwange power station, the RGM International Airport terminal, and for the NetOne fibre project. From India, Zimbabwe got US$18 million for the project to build a water supply line to the new Hwange power units.

RBZ is US$4.24 billion in foreign debt, from US$4.9 billion reported for 2021. Some of the remaining debt is for fuel, taken on when the government was buying fuel from suppliers. Among these is a large debt of US$249.7 million owed to Equatorial Guinea for “strategic imports” in 2005. Commodity trader Trafigura, once a major fuel supplier to Zimbabwe, is owed US$65 million under a 2017 contract.

RBZ also got into an US$86 million debt with trader Holbud for grain imports in 2004 and 2016. In 2021, RBZ won a court order barring Holbud from attaching its assets over the debt.

Zimbabwe also owed US$61 million to South African Airways in December for unremitted ticket sales, and another US$10 million to air travel body IATA.

Government plans to take over RBZ debts under a Bill to be presented to Parliament.

Since getting its Special Drawing Rights allocation from the IMF in 2021, Zimbabwe has made six drawdowns of a total US$857 million. The money was mostly used for infrastructure – such as roads – health and agriculture.

As at June, Zimbabwe owes neighbours US$102.9 million in arrears for electricity imports. Electricity of Mozambique is owed US$18.73 million, HCB Mozambique (US$74.92 million), Eskom of South Africa (US$7.38 million) and Zambia (US$1.86 million).-NewZWire