News Column

AfDB Confident Zim Will Overcome Challenges

July 17, 2014

Below are excerpts of the Q & A, The Herald Business had with African Development Bank resident representative Mr Matheus Magala.

How much has the AfDB committed to the various projects around the country? And could you please provide a breakdown of grants, loans, and lines of credit advanced to Zimbabwe?

The Bank Group commenced operations in Zimbabwe in 1982 and, as at June 2014, the Bank has funded 40 operations of which 12 are active. Total Bank cumulative commitment is estimated at US$810 million, composed of loans (73 percent), grants (21,7 percent) and lines of credit (5,3 percent).

The total commitments cover the following sectors: Multi-Sector (28,9 percent), Infrastructure (27,6 percent), Industry/Mining/Quarrying (18,3 percent), Water Supply & Sanitation (13,6 percent), Financial Sector (5,3 percent), Agriculture Sector (4,8 percent), and Social Sector (1,5 percent).

The Bank's current portfolio in Zimbabwe is composed of African Development Fund (ADF) grants, Africa Development Bank (ADB) loan, Zimbabwe Multi Donor Trust Fund (ZimFund) administered by the Bank. The portfolio has 12 active operations (covering 5 investment operations and 7 technical assistance/capacity building interventions) amounting $167 million of which $119 million (71 percent) is funded by ZimFund, $40 million (24 percent) by ADF grants resources and the remaining $8 million (5 percent) by ADB loan. One of the projects is Lake Harvest Project (US$8 million) in support of the private sector development.

The Bank's portfolio has four operations financed by ZimFund grants (US$119 million) and these are Urgent Water Supply and Sanitation Project Phase I ($43,7 million), Urgent Water Supply and Sanitation Project Phase II (US$19,8 million), Emergency Power Infrastructure Rehabilitation Project Phase I ($39,6 million) and Emergency Power Infrastructure Rehabilitation Project Phase II ($15,4million). Donors current commitments to ZimFund are approximately $145 million, the recent Danish $20 million commitment signed on 9 June 2014.

Of the total donor commitments, about $125 million in pledges have been fully paid-up by the donors.

The portfolio also includes capacity building and technical assistance interventions ($34 million ADF grant) which are focused on strengthening audit and procurement functions of government institutions, increasing transparency in the mining sector, enhancing core banking system of the reserve Bank of Zimbabwe, strengthening the national statistical system, and enhancing capacity of for debt, revenue, and public financial management.

The other capacity building project is support of Youth and Tourism Enhancement Project ($4 million ADF grants) aimed at contributing towards the reduction of poverty and youth unemployment through the improvement of the enabling environment for youth and tourism development.

The Bank also supports the transport sector by providing grant resources (USD 1,4 million) to the Government of Zimbabwe to undertake a comprehensive National Transport Sector Master Plan with a strategic framework and investment plan for sustainable development of the transport infrastructure and services to support growth and wealth creation taking into account green and inclusive growth.

What new projects are in the pipeline for Zimbabwe? And how is the Bank planning to assist in Zim-Asset funding?

Following the approval of ADF-13 (African Development Fund-13) at the end of last year for the period 2014-2016 and the associated resource envelope for Zimbabwe,), the Bank is now discussing with the Government of Zimbabwe on what priority new projects can be funded for the next three years in support of the Zim-Asset.

The discussions are taking into account the critical role infrastructure development, regional integration and private sector play in economic transformation and job creation to empower people and build more prosperous society.

In all projects funded by the Bank, a strong emphasis is placed on institutional capacity strengthening and accountability for enhanced service delivery. We see gender equality as smart economics (women and no less the 50 percent of the available productive resource in this country) and of course food security as critical to overcome fragility and build the necessary resilience on which a significant step change can be made. The bottom line is that there is no shortage of projects in the pipeline, be it power, water, irrigation systems, roads, ICT, dams, bridges, one stop boarder shops, capacity, etc. A major constraint is the scarcity of resources and hence the need for prioritization and to think innovatively, particularly in the face of the challenges in the country.

Please provide any other information that may be relevant?

The Bank's current operations at Country level are guided by the Country Brief for Zimbabwe covering the period 2013-2015, which was formulated after consultations with the Government, Development Partners and Non-State Actors. The Country Brief as well as the projects identified under it are aligned with the Government of Zimbabwe Medium Term Plan (2011-2015), Zimbabwe Agenda for Sustainable Socio-Economic Transformation (Zim-Asset, 2013-2018), and the Bank's Ten Year Strategy to support the country's recovery efforts and its quest to address the critical challenges of developing skills and human resources, strengthening and streamlining public sector institutions and investing in infrastructure.

Since we have now received new resources from 2014-2016, there will be the need to redefine the priorities and produce an addendum to the current Zimbabwe Country Brief (2013-2015). This is done in consultations with the government and other stakeholders including the development partners. As we start developing this addendum, an important part is the assessment of the country's fragility. You probably know that the Bank has a new strategy on how to address fragility in Africa.

We have moved from the notion of Fragile State to Fragile Situation and States in Transition because we came to realise that fragility is not a category of countries but a situation that can affect any country including the most developed.

As we look into the future, we remain confident that Zimbabwe will overcome the current challenges by engaging and working smartly with the development community. In this journey, the Bank will continue to be flexible and preserve its African character.

It will continue to strive to become the partner of choice and a trusted advisor.


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Source: AllAfrica


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