Zimbabwe's external debt declines

Zimbabwe's external debt fell by 2.3 percent after it paid a total 169 million U.S. dollars to the International Monetary Fund (IMF) last year, the Reserve Bank of Zimbabwe said in its annual report.

The report was quoted by Tuesday's The Herald as saying Zimbabwe's total debt disbursed and outstanding (including arrears) is estimated to have declined from 4,071 million U.S. dollars in 2004 to 3,978 million U.S. dollars in December 2005, representing a decrease of 2.3 percent.

This mainly reflects resource payments on public sector medium to long-term debt, particularly to the multilateral financial institutions.

The government paid back a total of 176.3 million U.S. dollars in 2005, of which 95.6 percent (169 million U.S. dollars) reduced the external payments arrears to the IMF to 144 million U.S. dollars as at December 2005, the central bank said.

The remaining 7 million U.S. dollars were paid to other external creditors, but the bank did not specify their identities.

It added that the capital account improved from a deficit of 234.1 million U.S. dollars in 2004 to a surplus of 2.7 million U.S. dollars in 2005.

The improvement in the capital account, the bank said, has increased availability of short-term financing for grain and fuel imports.

Zimbabwe's economy has been under siege over the past few years, reeling under economic sanctions imposed by the United States, Britain, the European Union and their Western allies after Harare embarked on land reforms in 2000.

The country is also battling record inflation, which reached 1. 204 percent in August.

Source: Xinhua