HARARE – Close to US$1 billion released to Zimbabwe by the International Monetary Fund (IMF) could be misused by the Zanu PF government to finance its 2023 election campaign, the Movement for Democratic Change Alliance has warned.
Zimbabwe last week received the equivalent of US$961 million in Special Drawing Rights (SDR) from the IMF, part of US$650 billion the IMF is distributing to its members in its largest-ever distribution of monetary reserves to provide additional liquidity for the global economy in the face of the Covid-19 pandemic.
Finance minister Mthuli Ncube said he would “hold back about $500 million” to prop-up the beleaguered Zimbabwe dollar, with the rest of the money used to support the acquisition of Covid-19 vaccines, investment in schools, hospitals, roads and other infrastructure priorities.
Zimbabwe reintroduced its currency, the Zimbabwe dollar, in 2019 after a decade of dollarisation. However, the local unit has struggled for stability amid deep foreign currency shortages in the economy.
The Zimbabwe dollar is officially trading at 86 against the U.S. dollar, but is significantly weaker, at 150 to the greenback, on a thriving black market.
Ncube said a revolving fund would also be set up to help manufacturers and mining companies buy new equipment, and to revive the horticulture industry by encouraging the cultivation of roses, macadamia nuts and blueberries.
The MDC Alliance however says Zanu PF has no history of financial prudence and fears the funds could be channelled to finance the party’s re-election campaign. Contrary to Ncube’s claim that the IMF disbursement was a “vote of confidence” in Zimbabwe’s economic management, the MDC Alliance said “the allocation is made to all IMF members regardless of how their economies are faring.”
MDC Alliance spokesperson Fadzayi Mahere said: “The IMF noted the risk of misusing SDRs in countries with ‘unsustainable debt and weak governance.’ The current levels of corruption in our country and our unsustainable debt is precisely what the IMF is warning against.
“The risk of misuse is very high. Zanu PF, given a but of fiscal space heading towards an election is likely to use the money for electioneering if not held to account. The past is replete with examples of how the regime misuses funds to fund election campaigns. There is no reason to believe this time it will be any different.”
The MDC Alliance called for public “vigilance” and the strengthening of the Auditor General’s powers to “audit, monitor and report timeously to the people of Zimbabwe on how these funds are being disbursed.”
