HomePoliticsGlobal Financial Crisis Might Affect Aid Package — Sadc

Global Financial Crisis Might Affect Aid Package — Sadc

A REGIONAL aid package to help Zimbabwe’s reconstruction could be affected by the impact of the global financial crisis on southern Africa, a senior Sadc official said on Wednesday.

Finance ministers from the 15-nation Southern African Development Community met in South Africa on Wednesday to discuss an aid package for Zimbabwe, where the new unity government faces a severe humanitarian and economic crisis.

The global economic meltdown has had a negative impact on Sadc — with many of the bloc’s members net importers of fuel or food — slowing GDP growth and increasing current account deficits, even in South
Africa, the block’s strongest economy.

“When (finance) ministers consider any support to Zimbabwe they have to take into consideration what is going on (globally), so for sure it is a challenge,” Sadc Executive Secretary Tomaz Salomao told Reuters.
“But they will support Zimbabwe,” Salomao said.

Zimbabwean Prime Minister Morgan Tsvangirai, who joined the power-sharing government with President Robert Mugabe earlier this month, said last week it could cost up to $5 billion to ensure the long-term economic recovery of the country.

South African President Kgalema Motlanthe, current chairman of Sadc, sought a regional response after meeting with Tsvangirai and his Finance minister Tendai Biti last week to discuss economic support.

A former breadbasket in the region, Zimbabwe must resolve an economic meltdown that has led to the world’s highest inflation rate and a worthless local currency.

Salomao reiterated Sadc’s position that Western sanctions against Zimbabwe be lifted to boost its economy, and said the regional body would consider appealing to the IMF and World Bank for funding.

“Where money will be coming from, we have a range of options, (such as it) coming from those member states who have reserves.”

“I think that we can also assist Zimbabwe in knocking on the doors of friendly countries who can also assist Zimbabwe, but as a request of a regional body,” Salomao said, without naming these countries.

Zimbabwe has in the past approached China and Libya for assistance as the US and Europe, who remain unconvinced of the new democratic order in Zimbabwe, adopted a tough line and imposed wide-ranging sanctions. — Reuters.

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