The Transitional Stabilisation Programme (TSP), Zimbabwe’s short term recovery plan addresses the majority of concerns raised in the Zimbabwe Democracy and Economic Recovery Amendment Act (Zidera 2018) and those of other international institutions, according to US Ambassador to Zimbabwe Brian Nichols.The Ambassador, however, said Zimbabwe will still not be able to access funding from International Financial Institutions such as the International Monetary Fund and the World Bank, as long as the law remained in place.
“The reforms that have been laid out in the legislative package . . . in the inaugural address by President Mnagangwa, and the TSP . . . covers 99 percent of what’s in Zidera and address the concerns of not only the United States but many in the international community with regards to Zimbabwe,” Nichols told our commercial radio station Capital FM on Wednesday.
Zimbabwe recently launched the TSP, a two -year recovery programme meant to stabilise the economy currently reeling under foreign currency and cash shortages that has seen companies failing to import adequate raw materials.
It also covers anti-corruption; expenditure cuts; political reforms and this with political commitments, would address the concerns of the US.
“This Government has put a positive foot forward and must continue on that path,” said Ambassador Nichols.
Zidera is an Act enacted by the US congress that imposed economic sanctions on Zimbabwe, the restrictions it said were meant to provide for a transition to democracy and to promote economic recovery. While the US has argued that the Zidera should be viewed positively by Zimbabwe, it has been one of the stumbling blocks to economic development and growth as it has imposed a risk premium on the country and prevented the southern African country from accessing funding and investment at both bilateral and private sector level.
On whether Zimbabwe could access funding from IFIs and the US, Nichols said Zidera only covered loans by International Financial Institutions like the IMF and the World Bank but does not impede private sector investments.
There is no impediment in Zidera to private sector investments although there are some individuals covered by a separate programme, said Nichols who added that there is interest in investing in Zimbabwe.
“People want to see those reforms implemented and to understand exactly what the economic regime they will be investing under particularly in tourism and the extractive sector. If you are putting millions of dollars, it could be a couple of billions of dollars in what you are investing, you want to have some certainty that you will be able to repatriate your profits, and have access to foreign exchange and those are major questions many investors would want to have certainty on.”
Nichols said Zidera is a road map for reforms and many in the international community agreed with it. On what needs to be done for sanctions to be removed, Nichols said Zimbabwe has to fully implement the 2013 Constitution and reforms announced by President Mnangagwa in the legislative agenda. Companies that were previously affected by sanctions include ZB Financial Holdings, Infrastructure Development Bank of Zimbabwe, Zimbabwe Fertiliser Company and Chemplex Corporation, Agribank and CBZ Financial Holdings.