HARARE: The African Development Bank has agreed to write-off Zimbabwe's $601 million arrears to the bank, an official said on Tuesday, helping the southern African country reduce its loans with foreign lenders.
Tapsoba Sibry, an executive director with the AfDB who is leading a team to discuss Zimbabwe's proposals to clear $1.2 billion in arrears to the International Monetary Fund, World Bank and AfDB said the bank would clear Zimbabwe's arrears.
"The total amount of Zimbabwe's arrears to the African Development Bank is $601 million. The resources that we are putting aside will clear the African Development Bank arrears," Sibry told reporters. Zimbabwe owes foreign creditors $9 billion and has been struggling for five years to recover from a catastrophic recession, widespread food shortages and hyperinflation.
The IMF said last week it will be at least three years before Zimbabwe can get loans from international lenders, and the country needs to strengthen its economic reforms to make sure it can repay its debt.
Finance Minister Patrick Chinamasa said Zimbabwe hoped to have the arrears written-off by December this year if members of the AfDB board of directors quickly agree.
"We have different strategies to clear different liabilities," he said, declining to give further details. Zimbabwe started defaulting on its debt in 1999 and does not qualify for new financing until it clears the arrears.
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