CONTRARY to government claims that the country can do without the donor community, the Reserve Bank of Zimbabwe (RBZ) is again pleading that Harare restores relations with the international dono
“Re-engagement of the international donor community was put in place as a measure to evoke a positive supply response and reduce inflation,” said Simon Nyarota, the divisional chief for National Development and Economics at the RBZ on Saturday.
He was speaking at a pre-budget seminar held in Mutare.
Since December last year, central bank officials have been on a major drive to re-engage the international community.
Two weeks ago the acting Minister of Finance Herbert Murerwa accompanied RBZ governor Gideon Gono to an International Monetary Fund (IMF) meeting in the US.
The government has over the past four years insisted that it can do without international donors such as the World Bank and IMF.
Nyarota said the RBZ had set aside $150 billion to finance the winter wheat programme and had also financed the rehabilitation of irrigation equipment in a bid to improve food availability in the country.
“The bank also financed the rehabilitation of irrigation equipment to the tune of $85 billion through the Agricultural and Rural Development Authority and the Grain Marketing Board. This assistance should go a long way in enhancing food security,” he said.
Nyarota also said they had set aside $200 billion, which is now being disbursed through the Zimbabwe Development Bank for the rehabilitation of industries and processing centres.
However, the disbursement of the money has raised concerns, with an economic analyst saying there is no evidence of increased productivity in the industrial sectors of the economy.
“The money is bearing fruit for some, particularly the agriculture sector but there is no persuasive evidence that industrial production capacity has increased and if the companies can pay back the money,” said economic analyst John Robertson.