ZIMCODD Takes the HIPC Debate to the People11 March 2010
The Zimbabwe Coalition on Debt and Development (ZIMCODD) today launched the second edition of a grassroots training manual on public debt. The booklet was unveiled in Harare at a reflective meeting held for ZIMCODD members, on debt sustainability measures for Zimbabwe. The launch coincided with the tenth anniversary of the social and economic justice coalition, which was established in year 2000.
The development comes at a time when Zimbabwe is grappling with an unsustainably high level of debt, estimated to be US$5,7 Billion owed to various creditors. According to analysts, arrears and interest constitute over 50 percent of the debt. Furthermore, the debt could balloon to US$7 billion by 2011 according to some projections, if it is not addressed and reduced in a consistent and systematic fashion. Current arrears are blocking new lines of credit. Four debt and arrears clearance options are widely reported to be under consideration. These are internal resource inflows, resource based debt restructuring, Paris Club debt restructuring and the Highly Indebted Poor Country Initiative (HIPC). The proposal on HIPC specifically has raised some debate, as some stakeholders believe that it will facilitate foreign interference in the country’s economic and political affairs, as well as project the country as an economic basket case. Speaking at the occasion, the Acting Chairperson of ZIMCODD’s Northern Region, Rosewita Katsande said that marginalised groups in Zimbabwe are keen to participate in formulation of economic policies. However economic policies and related issues appear too complex, and the opportunities to be heard are few. In this view, she expressed hope that the National Economic Council, which is provided for in the Global Political Agreement (GPA) would be a platform for genuine consultation with citizens on economic issues, including the debt. ZIMCODD is initiating public debate on debt sustainability measures in line with its economic literacy programme for grassroots entitled Civic Participation in Economic Development (CPED). The Coalition advocates for pro-people economic policies, and believes that any proposals and solutions on Zimbabwe’s debt must be firmly grounded in principles of social and economic justice. They assert that unsustainable debt is the biggest threat to people’s realisation of social and economic rights, because governments have to forgo financing of development projects and social sectors, for the sake of servicing the debts. Participants at the meeting listened to the experiences of Zambia with HIPC, from Privilege Hang'andu, a programme officer with the Jesuit Centre for Theological Reflection (JCTR) in Zambia. Hang'andu said Zambia became worse off after taking this policy prescription. He said that the economic reforms imposed on Zambia were mainly driven by the lenders themselves and completely ignored the realities obtaining on the ground. For instance, cut backs on education and health subsidies were forced on a country where 65 percent of the population was living in abject poverty. The IMF/WB reforms were so focused on bringing the debt stock to ‘sustainable’ levels that they were completely blind to the social impacts their reforms had on the majority of the population. Also addressing the meeting, the President of the Zimbabwe Congress of Trade Unions (ZCTU), Mr. Lovemore Matombo, said the IFI’s are focused on protecting the business interests of western countries and not to develop Africa. Said Matombo, “There is no country in the world that has developed under IMF and World Bank Programs.” He highlighted the problems of privatisation, retrenchments and cutbacks on social spending which characterized ESAP in the 1990s and warned that they were part of the conditionalities under HIPC. “There is no difference between ESAP and HIPC and inviting HIPC in Zimbabwe is inviting cancer”, he said. |
