As
of
September,
the
total
public
and
public
guaranteed
debt
stood
at
US$17.7
billion,
with
72%
being
foreign
debt
and
28%
local
debt,
Finance
Minister
Mthuli
Ncube
revealed
in
the
2024
National
Budget
proposal
last
week.
This
means
that
the
government
owes
a
lot
of
money
to
both
international
and
domestic
creditors.
To
meet
its
financial
obligations,
the
government
is
now
in
talks
with
Broughton
Capital
for
a
loan
of
US$100
million,
according
to newZWire.
Broughton
Capital,
which
claims
to
have
arranged
debt
syndication
of
close
to
US$2
billion
for
Thailand’s
infrastructure,
could
be
a
potential
source
of
funding
for
Zimbabwe.
Additionally,
the
government
is
also
negotiating
with
Dinosaur
Merchant
Bank,
another
UK-based
investment
bank,
for
a
loan
of
US$125
million.
Furthermore,
Zimbabwe
is
expecting
to
receive
loans
from
ABSA
and
Standard
Bank
in
2024.
The
two
South
African
banks
have
raised
US$193
million
for
the
construction
of
hospitals
and
clinics
in
the
country.
The
loan
disbursement
is
set
to
begin
with
an
initial
amount
of
US$105
million.
This
funding
will
be
used
to
compensate
UK
infrastructure
company
NMS
for
its
work
in
building
healthcare
facilities
in
Zimbabwe.
Given
the
challenging
debt
situation,
Zimbabwe
is
exploring
alternative
sources
of
funding
to
address
its
financial
obligations.
While
larger
global
lenders
remain
sceptical,
mid-tier
banks
and
partnerships
with
foreign
entities
offer
potential
solutions.
However,
Zimbabwe
must
take
measures
to
improve
its
credit
record
and
long-term
financial
stability.
Zimbabwe
has
been
using
its
mineral
resources
as
collateral
to
secure
loans.
In
February
2023,
the
country
borrowed
US$400
million
from
the
Africa
Export-Import
Bank
(Afreximbank)
for
budget
support
and
trade-related
infrastructure.
To
repay
this
loan,
Zimbabwe
will
use
35%
of
the
export
proceeds
from
platinum
sales,
which
are
managed
by
the
Reserve
Bank
of
Zimbabwe
(RBZ).
This
loan
has
a
maturity
period
of
6
years
and
carries
an
interest
rate
of
10.2%.
The
government
considers
it
a
significant
achievement,
as
it
has
been
challenging
for
Zimbabwe
to
access
external
finance,
especially
for
budget
support,
for
over
two
decades.
In
addition
to
platinum,
Zimbabwe
also
uses
gold
and
diamonds
as
collateral
for
loans.
These
valuable
mineral
resources
serve
as
guarantees
for
lenders,
providing
them
with
an
assurance
that
they
will
be
repaid.
There
are
concerns
among
some
people
that
the
minerals
in
Zimbabwe
are
being
misused.
The
Zimbabwe
Coalition
on
Debt
and
Development
(ZCODD),
for
example,
believes
that
the
loans
obtained
using
minerals
as
collateral
benefit
only
a
select
few
individuals,
which
they
consider
to
be
unfair.
Post
published
in:
Featured