World Bank closes Zimbabwe’s access to further support

The World Bank has become the latest institution to dismiss Zimbabwe's bid to access fresh loans from international lenders, unless the country first clears its arrears. Zimbabwe's external debt runs into billions of dollars and, last year, the country formally approached the World Bank for debt relief under the 'Highly Indebted Poor Countries' (HIPC) scheme.

However, the bank has since indicated that the country does not qualify for support and will need a comprehensive arrears clearance framework with the international community to qualify for fresh loans or further financial assistance.

"Zimbabwe's eligibility to receive assistance under the HIPC Initiative remains unclear," the World Bank said in its latest report.

"(The) Country could potentially be eligible for assistance if it meets end-2004 and end-2010 indebtedness criteria and if it clears its arrears to the (IMF's) Poverty Reduction and Growth Trust," the report further stated.

Tim Jones, policy manager at global lobby group Jubilee Debt Campaign said Zimbabwe was not automatically eligible for the "poor countries initiative".

"So a political decision has to be made over issues to do with the indebtedness criteria statistics has to be made for it to be considered for the scheme.

"There have been indications in the past from the World Bank and western governments that they will be willing to let Zimbabwe in but that was very much linked to political changes in the country," Jones said.

Jones added: "Following the July election result, it's hard to tell what's going to happen in future although we know that the Zanu PF government never wanted to go the highly-indebted poor countries route."

Original article: http://allafrica.com/stories/201401080376.html