Zimbabwe is looking to issue about $2.5 billion to $3.5 billion export-related bond after elections that are scheduled for July, and part of the money would be used to settle foreign lenders debts.
According to the country’s Deputy Finance Minister Terence Mukupe who mentioned this to the Zimbabwe Broadcasting Corp. on Tuesday, the southern African nation intends to use export receipts from tobacco, gold and horticulture to repay the bond.
“Post-election, we should be able to put in place a sovereign wealth fund or an export-related bond,” Mukupe said, “and we think we should be able to raise between $2.5 billion and $3.5 billion anchored on trade receivables.” He added that “the bonds would be repaid in annual installments of $140 million to$150 million.”
The export-related bond is also under consideration to access cash as the indebted nation, whose economy halved between 2000 and 2013, struggles to access cash that would help resuscitate dwindling industries and re-erect old infrastructure.
Foreign Minister Sibusiso Moyo, while giving a speech in London on Monday, noted that before the nation accesses other means of financing, Zimbabwe was unswerving in its goal to clear about $1.8 billion in arrears with the World Bank and the African Development Bank.
Following the default on its debt in 1999, the South African nation has not received funding from the World Bank, International Monetary Fund. However, the country’s President Emmerson Mnangagwa hopes to mend ties with the West as Zimbabwe looks to rejoin the Commonwealth.