SADC proposes US$2 billion rescue fund for Zimbabwe

JOHANNESBURG – THE Southern African Development Community (SADC) is considering the investment of $2 billion into Zimbabwe's reconstruction, South African Finance Minister Trevor Manuel said on Thursday.

This was much less than the $5 billion which Zimbabwean Prime Minister Morgan Tsvangirai said was needed to reconstruct the crisis-torn country.

"I was present when Prime Minister Tsvangirai gave the number, but it was just a number given," Manuel told SABC radio in an interview on a meeting of SADC finance ministers this week.

"There’s a document that actually splits the immediate costs over the next 10 months into two amounts of about a billion dollars each."

This included a $1 billion loan to "re-stimulate retail and all kinds of things… That’s one billion we are exploring", said Manuel.

"The other [is] about a billion dollars for emergencies in education, health, municipal services and some infrastructure."

The latter amount would include funds for water sanitation.

"It will be necessary to try and get as much support as possible to prevent this horrible, horrible, horrible scourge of cholera that Zimbabwe has lived through over these past few months," said Manuel, referring to the epidemic that has killed more than 3,800 people and infected 83,000.

Zimbabwe also has the world’s highest inflation rate and is grappling with severe food shortages.

Manuel said the SADC ministers also discussed the effects of the global finance crisis on the region with the African Development Bank.

"We are a number of commodity exporters and I think that the impact is pretty severe and we were able to work through that and we will prepare a more detailed report for a meeting of African finance ministers on the 10th and 11th of March to be held in Tanzania," said Manuel.

In Zambia, he said a drop in copper prices had impacted severely on that country’s economy.

"They’re at a point of possibly having to close the copper mines."

In the Democratic Republic of the Congo, 12 copper smelters have had to be closed down, he said.

In Lesotho and Swaziland, "there is a huge collapse in the fiscal position", said Manuel. – Sapa