By Alois Vinga
The African Forum and Network on Debt and Development (AFRODAD) lamented Zimbabwe’s debt distress levels amid appeals to stakeholders in similar situations to help find the best way to resolve the crisis.
Addressing delegates at the close of a three-day annual multi-stakeholder conference on Zimbabwe’s debt, acting director of AFRODAD Yungong Theophilus Jong said the issue plagues the southern African nation.
“Zimbabwe is one of those countries that are over-indebted and it is a matter of great concern to both AFRODAD and civil society and ordinary citizens of these countries. Such conferences are opportunities for us to share our experiences on how we can better handle a situation like the current one, ”he said.
Jong said the conference coincided with several proposals from the G20, the International Monetary Fund (IMF) and the World Bank on how to handle the debt crisis.
“The problem with over-indebtedness is that it affects development and we end up with citizens who fail to fully realize their aspirations as human beings.
“Dealing with this issue of debt crisis and over-indebtedness is an important issue and calls for the need to consider how Zimbabwe, as an already over-indebted African country, can get out of this situation,” he said.
In economic terms, over-indebtedness is a situation in which an entity is involved in unsustainable debt which can lead to over-indebtedness as a country is unable to meet its financial obligations.
Such defaults can cause borrowing countries to lose market access and incur higher borrowing costs, in addition to hampering growth and investment.
Zimbabwe is currently grappling with a total external debt of US $ 8.2 billion and a massive local debt of US $ 20 billion. Due to a difficult economic situation, the country does not have a clear strategy on how it intends to offset the debt.
Also addressing the conference, the director of the Zimbabwe Coalition on Debt and Development (ZIMCODD), Janet Zhou, called on the authorities to put in place measures that improve transparency and accountability in order to avoid a future over-indebtedness.
“This will go a long way in leveraging the youth dividend that we have by investing in industrialization, for start-ups that can grow and lift our young people who represent 67% of the population out of the extreme poverty in which they are are found. ” she said.