Harare, August 9, 2011 ---Zimbabwe Finance Minister Tendai Biti has revealed that part of the US$505 million the country received from the International Monetary Fund (IMF) in 2009 has been used to finance major capital projects.

Biti was forced to clear the air on the utilisation of Zimbabwe’s IMF special drawing right (SDR) after President Mugabe accused the MDC-T secretary general of sitting on the allocation while companies were closing down in Bulawayo.

In response to the global financial crisis and the need to supplement reserve assets of member countries, the IMF approved a US$250 billion (SDR 161, 2 billion) general SDR allocation to all the 186 member countries in August 2009.

Another US$33 billion (SDR 21.5 billion was made available the following month.

Zimbabwe was allocated SDR328.4 million (US$505 million). SDRs are the currency used by the IMF.

Biti in a statement on his ministry’s website on Monday said an amount of SDRs equivalent to US$150 million has so far been converted into lots of US$50 million and US$100 million between December 2009 and February 2010 to cater for critical expenditures.

The spending targeted the procurement of agriculture inputs for the 2009/10 summer cropping season, infrastructure projects and US$19, 54 million was allocated to the Zimbabwe Economic Trade Revival Facility (ZITREF).
The fund is administered by Interfin Bank for lines of credit to industry, Biti said.

Beneficiaries also include the Zimbabwe Power Company, the National Railways of Zimbabwe, Harare International Airport, the Joshua Mqabuko International Airport, dualisation of the Harare-Gweru highway, the Mtshabezi pipeline, Marondera town council, Bulawayo city council, Transmedia, national housing projects, TelOne and the Central Registry.

“Each institution that received funding signed a loan agreement with the Ministry of Finance specifying the purpose and the terms and conditions of the loan,” Biti said.

“Most of the institutions that were allocated the SDR resources have fully utilised them".

“Consequently a number of critical projects in various sectors of the economy have been implemented.”

He said the government had maintained US$215 million SDR balance a the IMF as national reserves, with another US$140 million earmarked towards settlement of the country’s obligations to the IMF’s Poverty Reduction and Growth Facility.