EU to help private sector

The European Union is trying to find ways of helping the Zimbabwean economy to recover.

Ambassador Aldo Dell’Ariccia
Ambassador Aldo Dell’Ariccia

To this end the European Investment Bank (EIB) is actively exploring possibilities of assisting, despite Zimbabwe’s arrears of over $300 million to the Bank. A team from the bank visited the country again last week to identify viable projects. The EIB cannot lend to government or to state enterprises due to the arrears, but the private sector is able to make applications for assistance.

Ambassador Aldo Dell’Ariccia, Head of Delegation of the EU, said the 11th European Development Fund, which runs from 2014-2020, would consider ways of assisting the in-country beneficiation of raw materials to ensure that a maximum value is added.

The Ambassador said the EU was also directly supporting the development of the private sector. Scarcity of financing and the absence of investment weighs heavily on the productive sector, hence the EIB initiative.

In the interim, Dell’Ariccia said, if the private sector submitted good and viable projects, funding could be made available from the EIB to help the sector help reverse the negative economic trend.

Because of outstanding debts to the EU, the EIB would have to channel these funds through the national private banking system.

At the meeting with Finance Minister Patrick Chinamasa, the EIB urged that Zimbabwe begin to reimburse its debt to create a conducive environment for on-going discussions with other international financial institutions. Despite the EU’s Restrictive measures and the Appropriate Measures, Dell’Ariccia said Zimbabwe and the EU enjoyed good business relations. The EU provides a lucrative market for Zimbabwe’s products through the Economic Partnership Agreement between the EU and Eastern and Southern Africa Region and the Indian Ocean.

Trade between Zimbabwe and the EU doubled between 2009 and 2012. During the first 10 months of 2013, Zimbabwe exported to the EU products valued at $333 million and imported goods worth totalled $190 million.

Exports included ferro-chromium, raw cane sugar, tobacco, non-industrial and industrial diamonds, copper (refined), raw hides, citrus, cut flowers and vegetable, granite, cotton, tea and leather.

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