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are not a factor in Zim's access to loans
U.S. Embassy Public Affairs Section
February 25, 2010
A diplomat at the American
Embassy in Harare says U.S. sanctions are not a factor in Zimbabwe's
relations with multi-lateral lenders such as the International Monetary
Fund (IMF) and the World Bank.
"There never has
been any connection between U.S. sanctions and Zimbabwe's relationship
with the IMF," James Garry, Economic Officer at the U.S. Embassy,
told journalists at a roundtable discussion on Wednesday.
Garry explained that
even if the Zimbabwe Democracy and Economic Recovery Act (ZDERA)
was to be repealed today, Zimbabwe would still not be able to access
loans because of its arrears with the multi-lateral lenders. Arrears
made Zimbabwe ineligible for loans even before ZDERA became law
in December 2001.
"There is a widespread
misapprehension that the U.S. has some kind of veto at the IMF.
It is not true. The IMF, for example, makes most of its decisions
by majority vote, and voting strength is assigned essentially according
to the country's financial interest in the Fund. The U.S.
has just 16.77 percent of the voting power at the IMF, and it is
not in a position to veto IMF decisions," said Garry.
On February 19, the Executive
Board of the International Monetary Fund announced its decision
to restore Zimbabwe's voting and related rights, and its eligibility
to use resources from the IMF's General Resources Account
(GRA), following a request from Zimbabwe's Finance Minister
Notwithstanding the restoration
of the eligibility to use GRA resources, said the IMF, Zimbabwe
will not be able to use resources from the GRA or the Poverty Reduction
and Growth Trust (PRGT) until it fully settles its arrears to the
PRGT (SDR 89.4 million or about US$140 million).
Garry said the restoration
of Zimbabwe's IMF voting rights announced by the IMF last
week opens the door to closer cooperation with the IMF, noting that
Zimbabwe must take further steps before it can borrow again from
the IMF. He said Zimbabwe's arrears with other multilateral
lenders such as the African Development Bank and the World Bank
also need to be addressed.
In a February 19 press
release, the IMF said access to IMF lending resources by Zimbabwe
is also subject to IMF policies on the use of such resources, including
a track record of sound policies and the resolution of arrears to
official creditors, which would require donor support. The multilateral
lender said "any remaining issues on further normalization
of relations will be addressed over time."
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