CREDITORS this week cast doubt on Zimbabwe’s official public debt figures after Finance minister Mthuli Ncube’s numbers showed a discrepancy of US$2,7 billion to the one he presented last month.
During a Zimbabwe debt arrears meeting held on the sidelines of the African Development Bank annual meetings on Wednesday in Nairobi, Kenya, creditors queried the country’s public debt figures, urging Harare to gain the confidence of the international financial institutions (IFIs).
In the meeting, Ncube said Zimbabwe’s total public and publicly guaranteed debt stock was estimated at US$19,2 billion made up of an external debt of US$13 billion and a domestic debt of US$6,2 billion.
He added that because of the debt, Zimbabwe was currently in debt distress due to accumulation of external debt arrears amounting to US$6,7 billion.
However, creditor representatives queried these figures saying Ncube had revealed that total public debt was US$21,9 billion at last month’s World Bank/International Monetary Fund spring meetings in Washington.
“And perhaps, also, following on to what my colleague said from Denmark on behalf of the Nordics and what you said, sir, on the numbers of public debt, I saw in your presentation, Minister, I think you mentioned US$19,2 billion. But we have also seen that [at] the spring meetings you put the figure at US$21,9 billion,” Switzerland ambassador to Zimbabwe, Zambia and Malawi Stephane Rey said.
“So, I think that it’s perhaps also a little bit where this confusion came from. But, if I understand correctly, in June we will get an update perhaps to hear the figure before all these figures start floating around and people get confused. So, it would be good to hear the confirmation of the numbers in that way, if you have it.”
This is not the first time monetary or fiscal authorities have been challenged over the reported public debt figures.
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Afreximbank in November 2021 revealed the pan-African bank had made total disbursements to Zimbabwe of US$13 billion after monetary authorities had said it was US$9 billion.
Melte Knudsen, the executive director in the board of the AfDB representing Denmark, Finland, India, Ireland, Norway and Sweden said government needed to keep intact the trust and momentum it had built over the years.
She added that government needed to take concrete action to deliver on its commitments within the next few months.
“I have been asked by my capitals to make a few comments here, because they are one after another. We take note that the debt is reported to amount to US$21 billion, up US$3 billion, or some 10% of the gross domestic product from previous numbers reported earlier this year,” Knudsen said.
“We stress the importance that the government remains fully transparent with the IFIs and donors to fully account for these numbers as it takes steps towards the signature of an SMP [Staff Monitored Programme] in the months ahead.”
She said an important opportunity for the government to show its good faith would be accommodating civil society organisations concerns over proposed legislation regulating their space which is now being considered in Parliament.
“And I understood here that there is a dialogue ongoing on plans for coming days,” Knudsen said.
“And, in relation to discussions on the land track, we very much welcome the recent invitation to qualifying BIPPA [Bilateral Investment Protection and Promotion Agreements] protected farmers to submit their applications for compensation and we encourage payments to be initiated as soon as possible.”
Rey implored Ncube to also elaborate on the US$20 million financial provision in Zimbabwe’s 2024 national budget towards paying farmers under BIPPAs as this was significantly lower than the US$3,5 billion.
A United Kingdom Foreign Office representative, Zahra Labate, said there was need to understand that the debt arrears clearance dialogue was essential to Zimbabwe’s recovery.
In response to these officials, the Finance, Economic Development and Investment Promotion ministry’s Public Debt Management Office head Andrew Bvumbe said government was committed to publishing its debt figures.
“We have committed to transparency and our numbers are published twice a year through the Annual Bulletin Transparency Report, and the issue of the domestic debt will be explained within the context of the 2023 Public Debt Budget, which will be published in December, and I can confirm this,” he said.
