Britain is working on an unprecedented 1 billion pound-a-year international emergency aid and development package to rescue the ruined Zimbabwean economy under a new political leadership.
The scale of the program – nearly triple the aid presently going to Zimbabwe – means it will be coordinated by the International Monetary Fund (IMF), World Bank, EU and UN.
It will be discussed at the IMF spring meeting on April 12 and 13 in Washington, at an EU general affairs council later in the month, and possibly at the margins of the Nato summit in Bucharest.
Models examined by the Department for International Development (det britiske Danida, red.) suggest that if the currency can be corrected, it will be possible for the economy to be turned around relatively quickly.
IMF work suggests hyperinflation can be brought under control in a year, allowing output to rise relatively rapidly. Price and exchange rate liberalization is seen as a condition of progress by the IMF. But British government sources said the 1 billion pound-a-year package, possibly assembled at a donor conference, might need to last many years.
Apart from focusing on reducing inflation, and steadying the exchange rate and balance of payments, the package will be directed at basic health and education services, infrastructure and justice. The bulk of British aid currently goes on HIV and Aids.
Meanwhile, international investors are beginning to show signs of interest as they suspect the end of President Robert Mugabes rule approaches.
Renaissance, a Russian investment bank aiming to become the market leader in Africa, says it has been pushing Zimbabwe as a good opportunity for around six months, with interest rising in the last six weeks in the run-up to the polls.
China says it has already invested 1,6 billion US dollar in Zimbabwe in 2007, and analysts say again it may increase its flows.
Analysts say Zimbabwean equities already looked cheap and there is enthusiasm for stocks such as mobile operator Econet and retailer and hotel chain Meikles Africa.
With its gold, nickel, platinum, palladium and steelmaking alloy ferrochrome reserves, Zimbabwe could potentially benefit from continued high global commodity prices.
But huge constraints remain. Analysts warn the southern African countrys electricity system is already failing to properly supply its shrunken manufacturing sector, only 30 percent of the size it once was, making any sudden increase in production impossible.
Kilde: www.worldbank.org
