Gono says Zimbabwe must repay debt and reform

HARARE – Zimbabwe's central bank governor Gideon Gono said the country must repay debts to multilateral institutions, restore donor relations and push through economic reforms to end a deep crisis, state media reported on Sunday.

"In the case of Zimbabwe, it is important to note that we would need to do a lot in terms of fully repaying what we owe the IMF, the World Bank and the African Development Bank," Gideon Gono told the Sunday Mail.

"We would also need to closely restore good financial relations with the Paris Club of lenders and all the other donors and financiers who we owe money."

Gono also called for economic reforms, his strongest signal yet that he is ready to work with Finance Minister and senior MDC official Tendai Biti on overhauling Zimbabwe’s shattered economy. Some critics blame Gono, an ally of President Robert Mugabe, for many of the policies that have wrecked the economy.

"Quite clearly…the need for a demonstrable track record for consistent and comprehensive macroeconomic policies should be pivotal in shaping our collective expectations on the current consultations (with institutions)," he was quoted as saying.

Zimbabwe’s economy is in virtual meltdown, with the world’s highest inflation rate and unemployment at around 90 percent.

Revamping the economy and persuading sceptical foreign donors and investors to help is the top priority for a new unity government between Mugabe and his long-time rival Prime Minister Morgan Tsvangirai of the Movement for Democratic Change (MDC).

"A robust future has to emerge through deeper co-operation among us as Zimbabweans as we work in harmony with each other to steadfastly implement coherent and internally consistent sets of macroeconomic policies," Gono added.

An IMF official said last week it could not disburse funding until Zimbabwe clears its arrears and demonstrates responsible economic policies. Economic Planning Minister Elton Mangoma told Reuters Zimbabwe had no means of paying arrears to the Fund.