ZIMBABWE has been excluded from a United States Bill providing for the cancellation of debts owed to the International Monetary Fund (IMF) by selected 50 poor countri
The Justice and Understanding by IMF Loan Elimination and Equity (Jubilee) Bill comes at a time when Zimbabwe is reeling under US$220 million arrears to the Bretton Woods institution.
If enacted into law, Jubilee intends to cancel multilateral debts owed to the IMF by eligible poor countries, while promoting human and economic development and poverty alleviation.
“The IMF shall cancel all debts owed to the IMF by eligible poor countries, and finance the debt cancellation from ongoing operations, procedures and accounts of the IMF established as of the end of the most recent fiscal year, including the Poverty Reduction and Growth Facility (formerly known as the Enhanced Structural Adjustment Facility,” the Bill says.
The Bill says the waiting period for debt “cancellation shall not exceed one month from the date of eligible poor country’s application for debt cancellation”.
The Bill would have been a huge relief to Zimbabwe which is struggling to resuscitate an economy torn apart by a controversial land redistribution exercise and a breakdown of the rule of law.
Eligible poor countries cited in the Bill are Angola, Bangladesh, Benin, Bolivia, Botswana, Burkina Faso, Burundi, Cambodia, Cameroon, Central African Republic, Chad, Cote d’Ivoire, the Democratic Republic of the Congo, Ethiopia, Gambia, Ghana, Guinea, Guinea-Bissau, Guyana, Haiti, Honduras, Jamaica, Kenya, Liberia, Madagascar, Malawi, Mali, Mauritania, Morocco, Mozambique, Namibia, Nepal, Nicaragua, Niger, Nigeria, Peru, Philippines, Republic of Congo, Rwanda, Sao Tome and Principe, Senegal, Sierra Leone, South Africa, Tanzania, Togo, Uganda, Vietnam, Yemen and Zambia.
The Jubilee Bill was authored by Democrat Maxine Waters, assisted by Republican Jim Leach, Democrat Barney Frank, Republican Spencer Bachus and Democrat Barbara Lee.
The Bill clearly states that a country won’t get any relief if the government has excessive military expenditures or has repeatedly provided support for acts of international terrorism.
A country can also be denied debt cancellation if its government is failing to cooperate on international narcotics control matters, or if the government – including its military or other security forces – engages in a pattern of gross violation of internationally recognised human rights.
Waters said although they could not obtain full debt cancellation for poor countries, their efforts had led to the development of the enhanced Heavily Indebted Poor Countries initiative to provide debt relief.
In 2000, the US government passed the Zimbabwe Democracy Act, a legislation that made it illegal for either the administration or firms operating in the US to help Harare financially.