ZIMBABWE has a weak Parliament which is failing the country in terms of monitoring the debt that keeps surging, placing the southern African nation in a distress position, market watchers have said.
According to the 2024 national budget, the total external debt stock as at end September 2023 amounted to US$12,7 billion, including liabilities on the central bank balance sheet assumed by Treasury.
Of the total external debt stock, the bilateral and multilateral debt amounted to US$9,1 billion, of which 76% are principal arrears, interest arrears and penalties.
A local governance expert Vincent Chakunda told NewsDay Business that Zimbabwe was in a weak position to repay its debts.
The debt is largely driven by arrears as the country continues to default on its obligations.
“One of the challenges relating to the growth of this debt is interest on arrears,” Chakunda told NewsDay Business.
“We are seeing the debt growing and it speaks to our weak repayment capacity and then interests are now accumulating on arrears. Sometime in 2018, (Finance minister Mthuli) Ncube borrowed about US$1,3 billion from China apparently without seeking the approval of Parliament.
“It caused a lot of stir during the time when Honourable (Former finance minister Tendai) Biti (and) former MP, sat on the Public Accounts Committee. And it also brought into question the oversight capacity of Parliament to monitor the debt.
Source: News Day
