Emmerson Mnangagwa and his wife Auxillia arrive at the presidential inauguration ceremony in Harare. File picture: Ben Curtis/AP
JOHANNESBURG - Zimbabwe is committed to repaying arrears to external lenders so it can resume support programmes with institutions such as the International Monetary Fund and end years of isolation from global capital markets, said the country’s president.

Emmerson Mnangagwa, the 75-year-old who took over as leader in November after the military pressured Robert Mugabe into resigning, said one of his priorities was reintegrating his country into the global financial system. The economy has halved in size since 2000, credit lines from most lenders have been withdrawn and infrastructure has crumbled.

Zimbabwe owes about $9 billion (R109.26bn) to lenders such as the World Bank and African Development Bank and has fallen behind in payments, with arrears recently amounting to about $1.8bn. If his bid to revive the economy is to succeed, Mnangagwa will need access to billions of dollars of support.

“We shall recommit ourselves to paying our debts, our arrears. I believe that they (lenders) will embrace us in the same manner they are embracing other countries,” he said in Harare last week.

Re-engaging with international lenders would be a first step for the Zimbabwean government, which is also considering a debut international bond sale so it can invest in infrastructure. “If this succeeds, we would really need a substantial injection into our economy, in particular into the productive economy,” he said.

Still, the Zimbabwean leader demonstrated little appetite for cutting costs in the manner that the IMF and other lenders have urged. The country’s more than 500000-strong civil service accounts for about 90percent of budget expenditure, crowding out investment in much-needed projects like restoring the capital’s water supply and fixing its roads.

Mnangagwa was to travel to Davos in Switzerland, the first time a Zimbabwean leader has done so. 

- BLOOMBERG