The International Monetary Fund (IMF) recently took an unusual stance in nearly 20 years, praising Zimbabwe for the trajectory of economic change since 2017.
In countries around the world plagued by the devastating Covid-19 that has eroded the economy, the Bretton Woods agency has absorbed not only its resilience to the virus, but also other extrinsic shocks like the 2019 Cyclone Eye Die. I therefore chose Zimbabwe.
He also qualifies Harare three months ago for a Special Drawing Right (SDR) of US $ 800 million as part of the IMF’s new US $ 650 billion relief plan in light of Covid-19.
The SDR is the IMF’s international reserve asset, created in 1969 to supplement the public reserves of member states.
However, the US $ 1.1 billion kittens are not eligible for Zimbabwe to obtain US $ 2 billion in new funding unless they repay US $ 7.66 billion in arrears to international financial institutions. such as the World Bank, the European Investment Bank and Paris. Club and African Development Bank.
Praising Zimbabwe’s economic development over the past three years, the Zimbabwe IMF team, led by Daneshwar Gra, relied on Covid for the national outlook in a report after a virtual meeting between Harare and the fund. I added that I do. 19 Evolution, implementation of vaccination programs and sustainable policies.
After that, the report continued. “The IMF’s mission focuses on the authorities’ efforts to stabilize local currencies and reduce inflation. Further efforts are needed to consolidate stabilization trends and accelerate reforms. “
This statement may take time for Zimbabwe to access financing for economic development from institutions such as the IMF, founded in 1944, to promote international financial stability and financial cooperation. It’s clear.
This means that the Zimbabwean authorities must continue to consider domestic bailouts to stimulate the economy, coupled with regional development cooperation.
In this way, we look to countries for the economic development opportunities available through continental economic partnership protocols such as the African Continental Free Trade Agreement (AfCFTA), which entered into force in January of this year. The call to the country to turn to the country has grown.
Zimbabwe’s Deputy Minister of Foreign Affairs and International Trade David Musabayana will benefit from the guest deal at the recent launch of the AfCFTA awareness and training workshop at the Zimbabwe National Botanical Gardens (ZNCC) in Harare. He said he was in position.
“The country’s potential interests include accessing import and export markets, reducing preferential tariffs and relaxing trade protocols that facilitate exports to local countries,” he said.
In the same platform, ZNCC President Tinashe Manzungu acknowledged that many companies in the country stand to benefit from the trade deals and that the national economy is the big winner.
He said Zimbabwe’s exports averaged $ 4 billion against an annual import bill of $ 6 billion, and trade deals increased the export basket after the country moved up the chain. of value to face continental competition. He pointed out that he could see it. Already, after ratifying it in 2019, the country has shown its commitment to the agreement and last week decided to remove visitor visa requirements for members of the Southern African Development Community.
This is a positive step in promoting regional trade and is in line with the continent’s desire for free movement and increased trade.
According to the African Union (AU), the AfCFTA will create a single market for goods and services with the main aim of increasing trade between African countries.
Therefore, the main objective of the agreement is to implement a protocol to eliminate trade barriers and promote the harmonization of competition policies of member states and other trade liberalization strategies.
Zimbabwe has access to a deal that is expected to boost intra-African trade by 53.3 percent if import tariffs and non-tariff barriers are removed.
Trade agreements also emphasize the rapprochement between African mining and imports.
The AfCFTA encourages member states to lock in natural resources when manufacturing African industrial products, with reports showing that Africa exports 75% of its mining products to other continents.
For many years Zimbabwe lamented the loss of minerals in their raw form and only bought products after the resources were added to the value overseas. A country has the potential to invest in industry to add value to its resources for the continental market.
The momentum towards industrialization should be inspired by the potential of the Continental Accord to double Africa’s manufacturing industry to $ 1,000 billion by 2025 and create stable jobs for 14 million people.
Development in Zimbabwe cannot exclude women from the equation.
It is estimated that 70% of national informal cross-border traders are women, and AfCFTA is the engine of continental trade, so this group can benefit more.
In addition, the informal trade of women has been harassed at the ports of entry, but if trade restrictions are synchronized, the development of women will be promoted.
Zimbabwe has many advantages in adopting the AfCFTA in response to hostility from Western-backed financial institutions.
The solution appears to be to find a domestically developed solution and make the most of economic partnership protocols like AfCFTA, as the country cannot get the relief it needs to improve its economy. is.
This means that greater concentration on the continent can improve the country, as exporting to the African market is likely to increase trade.
Within the framework of the AfCFTA and due to its strategic position in the region, Zimbabwe can be a trading center as it offers one of the shortest routes to reach further north of the continent.
The benefits of the AfCFTA are expected to extend to all sectors of Africa as a whole, not just Zimbabwe.
Transactions under the AfCFTA began on January 1 of this year, with the Pan-African private sector reporting to the African Business Council (AfBC) issuing a press release in support of the initiative.
The council took a look at what the new regional trade protocol was and said it offered huge business opportunities for the Pan-African private sector, SMEs, women and youth.
The start of the exchanges within the framework of the AfCFTA follows the decision of the Parliament of the African Union on December 5, 2020 during the 13th extraordinary meeting of the Parliament of the Union on the AfCFTA.
AfCFTA should take advantage of opportunities to strengthen inter-African trade in many sectors, including manufacturing, distribution, transport and health ecosystems.
AfCFTA strengthens trade by eliminating tariffs on intra-African trade, making it easier for companies to trade in Africa and take advantage of growing markets. We will introduce regulatory measures such as hygiene standards, eliminate non-tariff barriers to trade and establish a common continental market in the future.