The World Bank, a global multilateral institution that provides loans to developing nations for capital projects, is in talks with Zimbabwe concerning the most prudent use of the money raised under a fund to support the country’s economic strategic plan, the Zimbabwe Agenda for Sustainable Socio-Economic Transformation (Zim-ASSET).
The reserve, dubbed the Zimbabwe Reconstruction Fund (ZIMREF), already houses about $44 million from the World Bank and several partners, including the European Union, the United Kingdom, Germany, Norway, Denmark and Sweden.
Fund to stimulate investment
At the launch of the fund last month, Kundhavi Kadiresan, World Bank Country Director for Malawi, Zambia and Zimbabwe said the fund is expected to raise up to $100 million from donors and will be used principally to stimulate investment in the country. According to her, the Zimbabwe Reconstruction Fund replaced the Zimbabwe Analytical Multi-Donor Fund (A-MTDF).
“We are starting a new fund, Zimbabwe Reconstruction Fund. This trust fund will expand bank’s support to include investment projects, and to channel some financing directly through government systems. Contributions will be coming from many development partners, the amount is close to $40 million committed and the figure will increase in the coming year to $100 million,” she said.
The A-MDTF ran from 2008 to 2014 with over $22 million spent on policy assistance, technical assistance, information systems and analytical studies, all of which helped to strengthen dialogue with the government through the multi-fund.
Fund to foster reforms
The World Bank is currently working with government on a number of strategies for policy formulation. The ZIMREF, which will be implemented over a five year period from 2014-2019 is also expected to expand World Bank support of investment projects and to channel some finances directly to the government.
Patrick Chinamasa, Zimbabwean Finance minister said the fund would provide the required flexibility to tackle some urgent reform measures including parastatals reform. According to him, $15 million from the fund would be dedicated to carrying out an audit which would help reveal true figures and indices in all the parastatals.
“What I welcome about the Zimbabwe Reconstruction Fund is the flexibility that it is going to give me to tackle some of the urgent reform measures that I want to address. These are in the areas of parastatal reforms. As a first step to parastatals reform, we must know what these animals are, otherwise any reform, not guided by facts is a witch hunt. I don’t want to be involved in a witch hunt. Under the Zimbabwe Reconstruction Fund, $15 million will be made readily available to carry out this audit next year. We will start with the strategic ones and then the less strategic ones,” Chinamasa said.
By Emmanuel Iruobe
