Zimbabwe's new unity government has
welcomed Wednesday's decision by the International Monetary Fund (IMF) to lift
partially a technical assistance restraint it imposed on Harare. Lifting the
suspension, the IMF board said that next week it plans to review Zimbabwe's overdue financial obligations to
the Poverty Reduction and Growth Facility -Exogenous Shock Facility (PRGF-ESF)
Trust. The IMF also plans to help Harare in targeted areas such as tax policy
and administration, payments systems, banking supervision, and central banking
Political analyst George Mkwananzi told VOA that the IMF decision
is a significant boost to the new unity government's rebuilding efforts.
want to say that we welcome such a kind of announcement from the IMF with
guarded caution in the sense that obviously the people of Zimbabwe would be
relieved to hear such kinds of news, because it comes with a lot of things that
would improve their life," Mkwananzi said.
He said although the IMF
decision should be lauded, the new unity government needs to get its act
"But at the same time we
want to throw a word of caution to the direction of the Robert Mugabe-led
government because they might start to abuse such a kind of relaxation by the
IMF to mean that they are doing everything in the right way. We have seen in
the past few hours the arrests of opposition political party activists, which
is really not called for and not according to the spirit of inclusivity," he
Mkwananzi said the decision
of the IMF to lift the suspension of technical assistance to Zimbabwe is a
positive development for the country ahead of the government rebuilding
"It is obviously a sign of
bright things to come. The IMF as you know, being the central bank of world
financial transactions, it would mean that most of the countries might feel
encouraged even to open up their purses towards Zimbabwe. Because the Bretton
Woods institutions are actually a chief indicator that some level of confidence
is developing in the government of Zimbabwe, particularly because of the
presence of the opposition there," Mkwananzi said.
He said the IMF decision should
serve as a warning to the new unity government to ensure its economic
rebuilding efforts stay on course.
"I think this particular
gesture on the part of the IMF is a clear indication that they are committed to
doing something meaningful, you know, to assist Zimbabwe in its time of dire
need as long as Zimbabwe meets it side of the bargain in terms of fully
fulfilling the democratization process, opening up the airwaves and allowing
the media to act in a flexible atmosphere…I am sure the IMF and other institutions
would be encouraged to open up more and assist Zimbabwe so that very soon we
might see an avalanche of aid going to the direction of Zimbabwe," he said.
has so far has been unable to pay at least 133 million dollars it owes the IMF since
2001. That's when the economy collapsed, leading to the world's highest rate of
inflation. In light of the severe
economic crisis, the government has recently begun using foreign currencies to
tame hyper-inflation, which last July soared to an all-time high of
approximately 231 million percent, up from 11.2 million percent the previous
Unity government finance
minister Tendai Biti projected last week that the inflation would fall
least 10 percent by the end of this year as the new policy of using
currency is helping stabilize prices of goods and services. He adds
that international financing would be crucial to reviving the
economy in a country where industry has operated at less than 10
capacity for years.
The new government under
long-time President Robert Mugabe has been pleading for aid from the
international community. The government says it needs
at least $8 billion to help kick start Zimbabwe's shattered economy, rebuild
collapsed infrastructure, and pull the country back from the brink.
political analysts believe that Zimbabwe's struggle to find new investment
stems from two factors: the global
financial crisis and the domestic political crisis. Observers are looking for signs of progress
in power-sharing between President Mugabe and Prime Minister Morgan Tsvangirai,
hoping that economic conditions will also improve.