Newly uncovered documents reveal that Zimbabwe’s £210 million debt to the UK includes loans from Tony Blair’s government to Zimbabwe’s police force while they were engaged in internal repression.
Campaigners in Zimbabwe are calling for an audit of the country’s $7 billion debt to find out who did and did not benefit from past loans.
The Zimbabwean police were loaned money in the 1990s to buy 1,500 Land Rovers, backed by UK Export Finance (then known as the Export Credits Guarantee Department), a unit of the Department for Business.
These loans continue to make-up £21 million of Zimbabwe’s debt to the UK. The evidence appears in a new report published by Jubilee Debt Campaign, the Zimbabwe Europe Network and Eurodad.
The report reveals for the first time the origin of much of Zimbabwe’s $7 billion debt. At least $750 million of debt comes directly from structural adjustment loans from the IMF, World Bank and African Development Bank which lowered economic growth and increased unemployment.
“Debt has played a key role in the tragedies that many Zimbabweans have suffered over the last twenty years,” explained the report’s author, Tim Jones, “Dodgy projects, debt repayments and failed economic policies contributed to economic decline”.
Other loans revealed by the report include loans from the World Bank for tree plantations to create fuel supplies. However, the World Bank failed to realise there was already plenty of wood available, and there was no economic return on the plantations.
The report also describes loans from the Spanish government for the Zimbabwean government to buy military aircraft and unspecified “aid” loans from the UK, which were tied to buying exports from UK-based companies.
Jones, policy officer of the Jubilee Debt Campaign, insisted that “Lenders should help increase transparency and democracy by coming clean on where Zimbabwe’s debts come from”.
Zimbabwe is currently in default on many of its loans to the western world. Negotiations have begun on Zimbabwe entering the debt relief process for poor countries, run by the IMF and World Bank.
But the report argues this would trap Zimbabwe in further cycles of debt while keeping the questionable details of previous loans out of the public eye.
Instead the report backs the call of Zimbabwean campaigners for an audit of the debt which would show who did and did not benefit from the loans, and learn lessons for the future.
The organisations behind the report are calling for lenders such as the UK government to reveal where all the debt owed by Zimbabwe comes from, and signal they would support and cooperate with any debt audit held in Zimbabwe.
“The evidence presented in this report illustrates why decisions about debt cancellation cannot be left to creditors,” said Oygunn Brynildsen of Eurodad, “Following a transparent audit, an independent debt court must be put in place to hold creditors to account for former reckless lending.”
Tor-Hugne Olsen, Co-ordinator of the Zimbabwe Europe Network (ZEN), argued that “Zimbabweans need to know who benefited financially during the years of oppression under Mugabe and Smith, during years which have left the majority of people impoverished. The massive debt that besets the country should not be the burden of the people who have suffered under these regimes.”
The report, Uncovering Zimbabwe’s debt: The case for a democratic solution to the unjust debt burden, can be obtained from the Jubilee Debt Campaign. See http://www.jubileedebtcampaign.org.uk .