Zimbabwe’s Debt Crisis: women, youth are disproportionately affected

By Almot Maqolo

Zimbabwe Coalition on Debt and Development (ZIMCODD) says there is a need for the inclusion of marginalized groups in the debt contraction process to ensure inclusive decision making in the management of public resources.  The southern African nation is currently classified as being in debt distress and over the last 5 years, government debt has risen substantially from just over 48% of GDP in 2013 to an estimated 82% in 2017. 

Experts say that budgetary indiscipline and poor debt management are the main reasons for the current debt crisis and that external outflows of financial resources in the form of debt repayments and debt servicing deprive the citizens of basic service provisions mandated by the social contract. In these debt crises, ZIMCODD said women and youth are disproportionately affected.

“The impacts accrued to women due to gender roles and social norms that entrench patriarchy as they often have to stand in long queues for hours to collect water, for example. The crisis also increases the burden of unpaid care work and opens women up to more vulnerabilities and inevitably violates their rights to dignity and to live free from violence,” it said.

The debt crisis is a condition in which a country is incapable of servicing its debt with multilateral and domestic lenders. The government has not been adhering to legal provisions which require transparency and accountability in debt management set out in the Public Debt Management Act (Chapter 22:21). Zimbabwe’s public debt is shrouded in secrecy. It has been a subject of speculation as it is not clear how much it is. 

Treasury notified parliament that the total debt stood at US$17.4b billion as at the end of March 2019. This debt constitutes approximately 90% of the Gross Domestic Product. This is in violation of section 11(2) of the Public Debt Management Act as it exceeds the prescribed borrowing limit of 70% debt to GDP ratio. Conversely, some Civil Society Organizations estimate the total public debt at over US$23 billion. The debt crisis has affected the capacity of Zimbabwe’s local and central governments which in most cases are failing to provide basic services such as water, power, sanitation and health.

“Inclusion of all stakeholders will facilitate the contraction of sustainable debt and guarantee the continued provision of public services and developmental outcomes that benefit everyone. Economic growth will not only capacitate government to service debt but create safety nets that protect these vulnerable groups of society such as employment opportunities,” ZIMCODD stated. “Parliament needs to exercise its law making, representative and oversight functions to reduce the debt burden.”

ZIMCODD further called for the creation of a strong and autonomous debt management office. “Government should comply with the 60% limit threshold enshrined in the SADC Protocol on Finance and Investment, undertake a Socio-Economic Audit, formulate a comprehensive debt settlement plan and facilitate meaningful participation in debt contraction from all stakeholders.”

Show More

Leave a Reply

Your email address will not be published.

Back to top button