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African states give Zimbabwe $400 million credit - report

African states give Zimbabwe $400 million credit - report
Written by Nelson Banya
Wednesday, April 29, 2009 8:01:07 PM

HARARE (Reuters) - Zimbabwe has secured $400 million in credit lines from African states to revive its ailing industries, state media reported on Wednesday, in the first major financial package since a unity government was formed. Industry and Commerce Minister Welshman Ncube was quoted as by the Herald newspaper as saying African countries had committed to provide the credit lines to companies in Zimbabwe as it struggles to rebuild its shattered economy.

A unity government formed by rivals President Robert Mugabe and Prime Minister Morgan Tsvangirai has appealed for about $8.3 billion to help revive the economy.

"Minister Ncube said Zimbabwe had managed to secure about $200 million from countries in the Southern African Development Community and another $200 million from the Common Market for Eastern and Southern Africa to meet urgent and pressing working capital requirements for local companies," the Herald reported.

Although the funds from African states may help, Zimbabwe is in dire need of aid from Western donors, who have demanded broad economic and political reforms, including ending a new wave of farm invasions targeting the few remaining white farmers.

Western donors should not resume development aid until Mugabe's ZANU-PF party ends human rights abuses and backs serious reforms, Human Rights Watch said on Wednesday.

The group said police intimidation, arrests of activists and violent invasions of commercial farms by ZANU-PF supporters were continuing.

Despite the formation of the unity government early this year, donors remain reluctant to lend money. Land invasions, at the root of the collapse of the once vibrant economy, have continued, farmers say.

Ncube did not say which countries had offered the funds, but said companies would start accessing the credit lines in the next few weeks.

Zimbabwe's industries are currently operating at an average 10 percent of capacity, but a new government economic plan hopes to raise this to about 60 percent by the end of the year.

The country's manufacturing sector has been affected by the decline in agriculture following Mugabe's seizure of white farms.

Labels: DONORS, HUMAN RIGHTS WATCH, NEOCOLONIALISM, SANCTIONS

posted by MrK @ 7:03 PM