Fidelis Munyoro, Harare Bureau
The United Kingdom’s (UK) move to extend a $100m loan facility to Zimbabwe is a clear testimony that the former colonial master is warming up to the country and working on ending strained relations that have existed for almost two decades, a Cabinet Minister has said.
In a major foreign policy shift, the UK and the Standard Chartered Bank partnered to loan local companies in the private sector US$100 million, the first direct commercial loan to the country’s private sector in nearly 20 years.
Finance and Economic Development Minister Patrick Chinamasa yesterday said the country was short of lines of credit to support the productive sectors.
He said the facility, which had been arranged by the Commonwealth Development Corporation (CDC), a financial institution of a UK government, was the first significant line of credit to come “our way from Europe, and Western countries”.
“It is a very significant step that they have taken to support our economic recovery,” said Minister Chinamasa.
“That $100m facility will go towards supporting the productive sectors mostly to promote exports, which are necessary for us to grow the economy and the exports.”
Minister Chinamasa said Zimbabwe had made a breakthrough in terms of accessing international lines of credit to support its economy. The loan, which would be for up to three years, can be used for capital expenditure or working capital
He commended President Emmerson Mnangagwa for taking upon himself to re-engage the international community.
“It is in this light that he sent us, me in particular, as a special envoy to the UK, Sweden and France as a first step towards normalisation of political relations,” he said. “The President is of the view, which we all share that we must keep our old friends but we also need to open up to the international community and normalise relations with those countries that imposed sanctions upon us. I see this loan facility as significant step in the opening up, normalisation of our political relations between our country and the UK.”
The reconciliation follows the coming in of President Mnangagwa’s new political administration, which has embraced re-engagement with countries the world over that are willing to partner Zimbabwe in reviving its economy, which had declined.