The President of the African Development Bank (AfDB) Group, Mr. Donald Kaberuka, today called on Zimbabwe’s Government of National Unity to reduce economic policy uncertainties that could undermine the country’s recent economic recovery. He urged the government to implement policies that would boost confidence in order to keep momentum. Mr. Kaberuka was launching the Multi Donor Trust Fund, managed by the AfDB. On a 24-hour visit to Zimbabwe, Mr. Kaberuka also announced the opening of the Bank’s Zimbabwe Country Office and discussed the state of the economy with local authorities, including progress on a framework for the country’s multilateral debt.
In a speech for the Euromoney sponsored investment conference taking place in Harare, President Kaberuka commended the macro-economic stability restored since the establishment of the Government of National Unity. He however observed “this progress must now be consolidated and translated into better livelihoods for the people of Zimbabwe. The economy had made steady and credible recovery but was a long way from operating at its previous potential. “He added “fundamental issues remain such as policy predictability, clarity with property rights, uncertainties and the costs of doing business that hamper even faster recovery”. He further observed that many countries in Africa were steadily overcoming the effects of the recent financial crisis and resuming the path of growth. the AfDB President expressed his hope that Zimbabwe can join this dynamic and take advantage of the opportunities in the global economy.
President Kaberuka noted the urgent need for the rehabilitation of key infrastructure. At the request of the Zimbabwean Government, the AfDB prepared an assessment of the state of infrastructure, to provide a roadmap for the Government, donors and the business community on how to address this critical bottleneck. “The challenge will be immense but not insurmountable – the problem should be turned into an opportunity,” the President said.
The AfDB President observed that there was broad agreement that Zimbabwe’s external debt was unsustainable and stood in the way of efforts to raise the finance necessary to fund the economic recovery, and in particular to rehabilitate infrastructure. Commending the authorities’ determination to agree on a debt management framework, President Kaberuka said that the AfDB stands ready to work with the Zimbabwean authorities and its multilateral partners on the issue. He however added that the authorities must quickly agree on a debt management framework, and do more to boost investor confidence and partners’ perception about policy predictability.