Published: 03 July 2014

Cabinet has approved proposals to establish a debt management system to monitor local and external borrowings by government institutions.

The proposed setting up of the Zimbabwe Debt Management Office is expected to tighten local and external borrowings by government institutions through formulating strategies to clear outstanding arrears amounting to $9.9 billion.

The Minister of Finance and Economic Development, Patrick Chinamasa told the ZBC News on Thursday that the debt management system, which will be established by an Act of Parliament, will keep accurate records of government debts and evaluate borrowing proposals to ensure loans are given to the intended users.

"We hope this is the right way to go and it will benefit those involved in the process," said Chinamasa.

While the proposed system seeks to ensure the Minister of Finance and Economic Development will have the powers to borrow on behalf of the government, the National Business Council of Zimbabwe (NBCZ) president Dr Keith Guza says the success of the policy will depend on stakeholder commitment over its implementation.

"Implementation is a key cause for concern so lets wait and see," Dr Guza said.

The government is reeling under a $9.9 billion local and external debt which has made it difficult for fiscal authorities to access fresh loans from global financiers at concessionary rates.
- zbc

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