RBZ accesses US$1.5 bln in offshore facilities in 2019

HARARE – The Reserve Bank of Zimbabwe said it accessed offshore facilities more than US$1.47 billion in 2019 for Zimbabwe for balance of payments support as well to liquefy the since abandoned foreign exchange market.
According to the RBZ’s annual report for 2019, the offshore facilities were mainly from Afreximbank (including Letters of Credit), Gemcorp and fuel suppliers. No breakdown of the facilities is provided but the central bank adds that they were for critical foreign exchange support to the market for the importation of fuel, electricity, grain (maize and wheat), crude cooking oil, pharmaceuticals, fertilizer, agro-chemicals, and other raw materials.

Key export commodities including minerals, cotton and tobacco continued to provide the anchor in terms of both securing and repayment of these facilities.

Afreximbank has been Zimbabwe’s all-weather friend, as external financing remains scarce due to the continued accumulation of external debt arrears and the country’s negative perception.

The Cairo-headquartered bank has provided facilities for the importation of essential goods like fuel and has also provided a facility for industries to retool. In the past 20 years, Afreximbank has disbursed more than $8 billion to Zimbabwean entities in the public and private sectors without suffering any credit losses. However, it is the opaqueness of some of the facilities particularly Afreximbank and Gemcorp that has drawn criticism from certain sections.

Re-engagement with the West, International Financial Institutions (IFIs) and arrears clearance resolution remains critical in unlocking new external financing required for sustainable development.


In the private sector, a total 122 offshore loan facilities worth US$1.0 billion were approved mainly dominated by tobacco funding through tobacco merchant parent companies. Overall agriculture funding made up 79.14% at US$803 million from 46 facilities and Financial services obtained US$119.5 million to contribute 11.78% of total.

Source: Reserve Bank of Zimbabwe

More recently for the 10 months to October, RBZ governor John Mangudya said that loan proceeds were at US$745 million, an increase of 61% from US$462 million in the comparable year ago period.

Meanwhile, total external debt is estimated at US$8.2 billion, as at end September 2020. This is an increase by US$106 million from the end 2019 amount of US$8.09 billion and was mainly on account of penalties and interest arrears. Of the total external debt, 17% is owed by public entities through guarantees. Arrears make up US$6.34 billion or 77% of external debt.-Financial Express.