Zimbabwe's Reserve Bank has secured Sh99 billion in foreign loans to stabilize critical imports amid severe dollar shortages, according to central bank governor John Mangudya. The funding, sourced from African financial institutions, aims to cover four weeks of import needs as the nation grapples with economic instability.
Mangudya revealed the loans include Sh64.2 billion from the African Export and Import Bank, Sh15.2 billion from the Eastern and Southern African Trade and Development Bank, and Sh2.5 billion from Mozambique’s Central Bank. These facilities, with repayment terms spanning three to five years and interest rates up to six percentage points above Libor, will be serviced through future gold export revenues.
The central bank retains 45% of dollar sales from gold producers and 50% from other miners to finance imports and foreign debt. However, mining companies have requested an extension of the 30-day limit on holding foreign currency balances, citing operational challenges.
Zimbabwe abandoned its 1:1 dollar peg in February 2019, merging bond notes and electronic dollars into the RTGS currency. The move followed a record Sh420 billion in gold exports in 2018, which accounted for a third of the nation’s total earnings.
