By Alois Vinga
AFRICAN Forum and Network on Debt and Development (AFRODAD) has bemoaned Zimbabwe’s debt distress levels amid calls for stakeholders in similar situations to assist in finding the best to solve the crisis.
Addressing delegates at the close of a three-day-long Zimbabwe Annual Multi-Stakeholder Debt Conference AFRODAD’s acting director, Yungong Theophilus Jong said the problem is bedeviling the southern African nation.
“Zimbabwe is one of those countries which are in debt distress and it’s a very concerning issue both for AFRODAD and civil society and ordinary citizens in such countries. Such conferences are opportunities for us to share our experiences on how we can better manage a situation like the current one,” he said.
Jong said the conference coincided with several proposals from the G20, International Monetary Fund (IMF) and World Bank on how to deal with the debt crisis.
“The problem of debt distress is that it affects development and we end up with citizens who fail to achieve their full aspirations as human beings.
“Dealing with this question of debt crisis and debt distress is an important issue and calls for the need to consider how Zimbabwe as an African country already in debt distress can come out of that situation,” he said.
In economic terms, debt distress is a situation where an entity is embroiled in unsustainable debt that can lead to debt distress with a country being unable to fulfill its financial obligations.
Such defaults can cause borrowing countries to lose market access and suffer higher borrowing costs, in addition to harming growth and investment.
Zimbabwe is currently saddled with a total of US$8.2 billion external debt and a whopping US$20 billion local debt. Owing to a difficult economic situation, the country does not have any clear strategy on how it intends to offset the debt.
Also addressing the conference, Zimbabwe Coalition on Debt and Development (ZIMCODD) director Janet Zhou called on authorities to put in place measures which enhance transparency and accountability in order to avoid future debt distress.
“That will go a long way to leverage on the youth dividend that we have by making investments for industrialisation, for startup businesses and which can grow and lift our youths who are 67% of the population from the extreme poverty that they are in,” she said.
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