Zimbabwe sees "positive" response to aid call: Biti
HARARE (Reuters) – Zimbabwe's unity government has received a good response to its calls for financial aid to rescue its battered economy, Finance Minister Tendai Biti said on Wednesday.
The new government, formed after a political deal between former rivals President Robert Mugabe and Prime Minister Morgan Tsvangirai, says it needs about $8.5 billion to fix an economy hit by hyperinflation and 10 years of negative growth.
Asked about how the international community had responded to the unity government’s plea for financial support, Biti said: "It’s been positive, but we’re still looking for international lines of credit."
Other countries and banks had promised funding, apart from South Africa, which had pledged an undisclosed amount in lines of credit.
"A few other countries that I don’t have the mandate to disclose, and some banking institutions, some on the continent and some from Europe, have made an undertaking to extend lines of credit to the banking sector," Biti told a media briefing.
Western donors have withheld aid to Zimbabwe over policy differences with Mugabe, and want to see political reforms put in place before resuming support.
Biti said while the government’s decision to allow the use of multiple currencies for business transactions had brought price stability, the economy faced liquidity problems due to a foreign currency crunch.
Biti, a senior official in Tsvangirai’s Movement for Democratic Change (MDC), said the inclusive government had made significant progress since its formation in February.
"In the … months that we’ve not been fighting each other, we’ve made phenomenal progress," he said. "I had to be dragged into government, but I will be the first to defend the gains of this government."
Biti, however, said the new administration still had a long way to go in fixing the economy, with monthly revenue averaging just $20 million against a $100 million target. Government workers’ wages alone required $30 million, he said.
Asked about his working relationship with central bank governor Gideon Gono, a Mugabe ally Biti has previously described as an "economic terrorist", the finance minister accused the media of playing up their differences.
"You cannot have a functional country in which the central bank governor and finance minister cannot work together. The problem is that there is a constant attempt to draw us into negativity," Biti said.
"I think since the formation of this government, the negatives are in the minority."
The MDC has previously called for Gono’s dismissal and protested against his reappointment last year, while talks with Mugabe’s government to set up a unity government were underway.