Zimbabwe secures loan to revive economy

August 30, 2010 12:00 am

, HARARE, Aug 30 – Zimbabwe has secured a 50-million-dollar (39.3-million-euro) loan facility from the Africa Export Import Bank to revive its agriculture and manufacturing industries, the bank said on Monday.

"The purpose of the revival fund is to resuscitate a broad range of firms  in the productive sector especially in agriculture and manufacturing by providing medium-term funding," Gift Simwaka, an official of the bank, said.

In addition the Zimbabwe government will also contribute 20 million dollars to the joint loan facility which will be disbursed through banks to small and medium scale companies.

Prime Minister Morgan Tsvangirai said the loan will help the country revive its economy.

"The facility was established to curtail the challenges of high interest rates, unequal distribution of lines of credit … limited lines of credit and lack of financing within the economy," Tsvangirai said.

"While this facility represents a positive development it alone cannot address economic challenges that face Zimbabwe."

Zimbabwe\’s economy, which has been facing difficulties over the last years, is slowly recovering after the formation of a unity government by President Robert Mugabe and Tsvangirai in February 2009.

The unity government off-loaded the worthless Zimbabwe dollar introducing multiple currencies such as the US dollar into the economy.

The unity government has been battling to secure lines of credit from international banks but no major loans have been secured.

Finance Minister Tendai Biti said the "lack of capital" has been "one of the major structural bottlenecks bedevilling" the country\’s economic turn around.


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