Maravi

(TALKZIMBABWE) Biti's HIPC plan triggers concern

Biti's HIPC plan triggers concern
Newsnet
Fri, 02 Oct 2009 17:32:00 +0000

THE move by the Minister of Finance Mr. Tendai Biti to declare Zimbabwe a - Heavily Indebted Poor Country, has triggered concern from Advisers on Zimbabwe Debt Management Strategy who say the philosophy has far reaching implications to the economy given that the country is still under sanctions imposed by the same western allies.

Sources close to treasury revealed that the Minister of Finance is working on a Heavily Indebted Poor Country (HIPC) project and is deliberately letting the economy bleed by blocking the US$510 million fund given to Zimbabwe by the IMF.

Such a move will lead to the shrinking of the economy to a stage where he can lobby for a decision to declare the country a Heavily Indebted Poor Country.

In principle, the Heavily Indebted Poor Countries’ initiative is an intervention jointly structured by the IMF and the World Bank as a way of providing debt relief to countries deemed to be heavily indebted and poor.

And in essence, the underlying philosophy of HIPC is that a country must first publicly announce its vulnerability and degree of high poverty levels and heavy indebtedness before it can get sympathy from the league of lenders.

In the case of Zimbabwe, technocrats feel that there is need for extreme caution to be taken, given that the country is under sanctions imposed by the same people that have a say on whether or not Zimbabwe would get help after self declaration of HIPC status.

It is also important to note that when a country declares itself to be in the HIPC cluster, any delays in the actual assistance as is likely to be the case with Zimbabwe would trigger a sustained worsening of investor-creditors sentiments on Zimbabwe to the detriment of the economy.

If left unchecked Mr. Biti’s HIPC project has the capacity to damage and leave the economy with deep scars that might never heal.

Mr. Biti has over the past weeks been under the spotlight from different sectors which condemned him for holding the country at ransom by blocking the US$510 million unveiled by IMF to member states.

Observers are of the opinion that Mr. Biti is being used by the Western forces to declare Zimbabwe an HIPC state to achieve their regime change agenda as President Robert Mugabe will be held responsible for running down the country by virtue of him being the Head of State and Government.

Labels: HIPC, MDC, NEOCOLONIALISM, NEOLIBERALISM, SANCTIONS, TENDAI BITI, ZDERA

posted by MrK @ 7:15 PM