THE International Monetary Fund (IMF) has postponed to a later date a scheduled board meeting to discuss Zimbabwe’s overdue financial obligations after failing to secure a date for its fact-finding mission to Harare this month, sources said this week
Central bank sources told businessdigest last week that an IMF mission was coming to the country mid month, but investigations this week revealed that a conflict over policy issues between the Reserve Bank governor Gideon Gono and Finance minister Herbert Murerwa had scuttled prospects of an early visit.
Businessdigest reported earlier that the Bretton Woods institution was expected to schedule its meeting to Zimbabwe to September, a move that was expected to open another anxious chapter in Zimbabwe’s relationship with the IMF after the country survived expulsion from the Bretton Woods institution when it settled its overdue financial obligations to the IMF’s General Resources Account (GRA) in February.
Government and central bank authorities had been informed of the pending review, initially expected to take place exactly six months after an IMF board meeting that maintained censure on the country after payment of arrears to the GRA.
Speculation deepened in the market that Murerwa was making frenetic moves to block an IMF team into the country around the same month for a routine Article IV consultation.
There were indications that Murerwa was, however, willing to have the team in the country in September, but Gono, who is leading the economic reforms, had preferred a later date and had overruled Murerwa.
Gono and Murerwa have clashed over policy issues, with Gono at one time writing to Murerwa that he did not know “whether we are working for the same government”.
The sharp differences between the two were further highlighted by Murerwa’s attack on Gono’s monetary policy during a politfolio committee meeting at which he alleged he had not been consulted when Gono introduced a new currency system slashing three zeros from the country’s currency.
The mission’s findings, together with any attempts by the country to clear outstanding arrears, are meant to establish Zimbabwe’s cooperation with the Bretton Woods institution’s demands for an overhaul of economic and structural policies.
However, sources indicated that the board meeting was unlikely to take place this month in the absence of an Article 1V consultative meeting report from an IMF mission into the country.
Consequently, the IMF had moved a scheduled board meeting on Zimbabwe to a date yet to be announced at the end of the year.
The mission had also now been scheduled to make its visit for the article IV consultations, which are routine for all IMF members, in November.
An IMF spokesperson told businessdigest from Washington: “The Article IV mission is expected to take place towards the end of the year. The next board review is expected to take place in early November.”
She said “no precise dates” had been agreed between the IMF and authorities in Harare.
The IMF, which upheld a decision to keep Zimbabwe’s voting rights suspended during its board meeting in March, had said it would meet again in September to review the country’s outstanding arrears.
There were indications that recent economic policies had failed to win the support of the IMF, suggesting that fresh measures could be taken against Zimbabwe for non-cooperation with the multilateral institution’s demands for broader market-related reforms to take the country out of its economic morass. Article IV consultations are routinely conducted on IMF members, but Zimbabwe had been understood to be digging in its heels on the planned visit, insisting its membership to the fund is only nominal.
Zimbabwe cleared its overdue financial obligations to the IMF’s GRA but still remained with substantial arrears amounting to US$119 million under the Poverty Reduction and Growth Facility (PRGF)-Exogenous Shocks Facility Trust (ESF).