HomeLocal NewsNo reforms, no funding: EU

No reforms, no funding: EU

THE Zimbabwean government, post-election, will have to introduce tangible monitored and time-bound political and economic reforms to be considered for budgetary support, the outgoing European Union Ambassador to Zimbabwe, Phillipe Van Damme, says.

By Owen Gagare/Nyasha Chingono

In an exclusive interview with the Zimbabwe Independent on Monday, Van Damme, whose tour of duty ends on August 31, said “whoever is running the government” will have to prioritise the reform agenda, including issues that have been on the table for a long time.

He said the International Monetary Fund (IMF) will play a pivotal role in deciding relations with Zimbabwe, in line with steps taken to ensure reforms.
“You know that you have to gradually address the issue of property rights and security of tenure. You know that you have to sort out the ease of doing business and fight corruption in a credible way,” Van Damme said.

“Now what is expected is that the incoming government comes up with a concrete time-bound plan on all these reforms which is monitorable. Because the key in all this will be the IMF!

“The IMF will have to engage the government on a reform package which will have to go to the board of the IMF and which will lead to an extended credit facility,
whatever name will be given, which will then be disbursed in tranches, linked to the implementation of the reforms.

“That’s why you need a time-bound calendar of implementation of critical economic reforms that each six months when a tranche is disbursed you can make an assessment of the progress made of these political reforms on the economic agenda. The same should be done on the political front,” he added.

Van Damme said some of the reforms are “low hanging fruits because they do not require money” but need political commitment.

He said some of the reforms which Zimbabwe committed itself to have been on the table since 2015 when the country signed up to political and economic reforms under the Lima Plan.

“On the political front, we have the alignment of the constitution which government has made commitments on, the electoral environment as well as the media environment. You have a truckload of political reforms on the table and you know them,” Van Damme said.

“On the economic front, it is the same thing. You know that you have to find ways of rebalancing your fiscal deficit…You know that you have to sort out the ease of doing business environment and fight corruption in a credible way and in a non-selective way.

“If there is commitment to political and economic reforms, a climate will be created on which goodwill is created to accompany these reforms.”

Zimbabwe presented an arrears clearance plan to its creditors in Lima, Peru, in 2015, which was anchored on several financial sector and structural reforms.

The strategy involved a plan to settle US$1,8 billion arrears to preferred international financial institutions (IFIs) to allow the country to access US$2 billion in new funding.

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