IMF declares Zimbabwe ineligible for future funding

The International Monetary Fund (IMF) said in a statement on Tuesday that it had barred Zimbabwe from future IMF loans or use of its general resources. The decision followed the IMF Executive Board's review of Zimbabwe's financial obligations to the organisation. The IMF executive board "declared Zimbabwe ineligible to use the general resources of the IMF and removed Zimbabwe from the list of countries eligible to borrow resources under the Poverty Reduction and Growth Facility (PRGF)," the statement said. The PRGF facility allows countries to borrow money at low or reduced interest rates to implement poverty reduction programmes in their respective countries. "The declaration of ineligibility to use the general resources of the IMF is one of the remedial measures taken to encourage members to settle overdue financial obligations to the IMF," said the statement. The IMF said it would review the situation in Zimbabwe in three months' time. The IMF said that since mid-February Zimbabwe had fallen behind by about US $53 million in its payments to the organisation. "The IMF's Executive Board urged the Zimbabwean authorities to make full and prompt settlement of Zimbabwe's overdue financial obligations to the IMF," said the statement. The IMF suspended loans to Zimbabwe in October 1999 after government efforts to liberalise the economy went off-track. In May, the IMF said Zimbabwe had stopped payment on its loans. Zimbabwe's total foreign debt is estimated at US $4 billion.