Debt choking developing countries, impeding industrialisation – Mthuli

Oliver Kazunga

DEVELOPING countries are grappling with heightened debt vulnerabilities and this is hindering development and industrialisation in Southern African Development Community (SADC), Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube has said.

Addressing delegates at the Southern Africa Development Community Industrialisation Week (SIW) in Harare this morning, Mthul said:

“It is apparent that developing countries are grappling with heightened debt vulnerabilities as indicated by subdued solvency and liquidity indicators.

In this regard, debt restructuring initiatives and more effective implementation debt relief programmes such as the G20 framework would free-up financial resources which can be channelled towards industrialisation, drive economic progress and development.

Sadc Industrialisation Week Day One in pictures

“In fact, we have argued in other fora globally, that the G20 framework needs to be reformed.”

Against this background, Mthuli said, it was imperative to reform the global financial architecture to support the industrialisation agenda in the region.

“The global financial architecture is tilted against the developing countries from a low share of Special Drawing Rights quotas that were extended by the IMF.

“Three years ago, as Zimbabwe we used to borrow at something like 8 percent per annum, right now we are borrowing at about 12 percent in terms of the debt that we are able to access and this has nothing to do with the credit rating of the country and every any other country can tell you a similar story,” he said.

Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, addressing delegates during ongoing Sadc Industrilisation Week and Investment Conference.

Delegates follow proceedings at the SIW and Investment Conference in Harare this morning