until the southern African country embraces good governance and stops harassing investors and industrialists, diplomatic sources said this week. Speaking as consultative talks between the government and an IMF delegation dragged on in Harare, sources said the fund, which abandoned Zimbabwe in August 1999, would maintain “a wait-and-see attitude on Zimbabwe.”
A six-member IMF delegation this week met Finance Minister Herbert Murerwa, Gideon Gono, Reserve Bank governor and leaders of the opposition Movement for Democratic Change (MDC).
Official sources said the IMF blasted Murerwa for the illegal arrest of business leaders on allegations of flouting price controls, which the IMF vehemently oppose. The team reiterated the importance of market forces dictating prices of goods and commodities.
Long-standing differences such as the question of Zimbabwe’s distorted exchange rate and the slow pace of privatisation of loss-making government parastatals are also still an impediment to the resumption of IMF aid to Harare, the diplomats said. The IMF’s suspension of balance-of-payments support to Zimbabwe has blocked billions of dollars worth of aid from other donors and institutions, which provide help to countries that have functional IMF aid programme.
The MDC’s economic affairs chief Eddie Cross said the IMF delegation had, in technical discussions, generally accepted the opposition party’s approach and proposals on key policy issues such as how to stabilise Zimbabwe’s exchange rate, interest rate management and the handling of the burgeoning national debt.
The MDC’s economic policy, dubbed RESTART, proposes cutting by half the size of the government to rein in spending and drastically reduce the US$4.5 billion owed by the government to foreign creditors within the first 100 days of the party’s coming into power. – Own correspondent