Cairo-based Afreximbank lead arranger for $1.8bn Zimbabwe arrears loan

Egypt-based African Export-Import Bank (Afreximbank) is lead arranger for a $1.8 billion loan to help Zimbabwe clear arrears at the World Bank and African Development Bank, the state-owned Herald newspaper said on Tuesday, citing the country’s finance minister.

Finance Minister Patrick Chinamasa said last week the southern African nation had negotiated a cheaper loan to pay the arrears – a crucial step for it to regain access to global financing sources – but did not give details.

“Afreximbank (Africa Export and Import Bank) is the lead arranger to secure funding for the repayment of our arrears of $1.8 billion,” the newspaper quoted him as saying.

The bank has become the largest foreign lender to President Robert Mugabe’s government in the last four years.

Chinamasa was not immediately available for comment.

Zimbabwe was shut out of international debt markets after defaulting on foreign payments in 1999 and has a foreign debt of $7 billion, half the size of its economic output.

Afreximbank provided a $200 million guarantee for Zimbabwe’s surrogate “bond note” currency and will more than double that facility to $500 million this year, the central bank has said.

It also agreed last month to lend $600 million to help replenish Zimbabwe’s foreign bank accounts.

Source: Reuters