Zimbabwe: Govt to Recalculate Interest On RBZ Debt

4 September 2018

Government will enlist the services of a consultant to recalculate interest on debts it contracted before 2013 with a view to identifying instances where it overpaid and enforce recovery of such amounts.

The Ministry of Finance and Economic Development has since tendered for expression of interest by specialised debt interest recalculation service providers to evaluate payments on Reserve Bank debt assumed by Government.

Government assumed the RBZ Debt which was contracted prior to 2013 with the process involving validation and reconciliation by the Public Debt Management Office in the Ministry of Finance and Economic Development.

However, due to the complexities surrounding the validation and reconciliation exercise, Government feels that there is need to subject the interest calculation process to specialised interest recalculation.

"The consultant shall be responsible for identifying creditors who could have overcharged and paid interest, recalculate the interest and enforce the recovery of such overpaid interest," said Government in a statement.

The consultant, Government said, shall work closely with the Ministry of Finance and Economic Development. The consultant's work entails identifying creditors who overcharged interest to Government and its institutions.

Further, the consultant's responsibilities will entail recalculating interest on debts which would be identified and if overcharged payments are established, to enforce the recovery of such overpaid interest amounts.

"This could be done through the application of law or technical financial expertise lenders may have violated in the process of charging interest to Government."

Government assumed the central bank's $1,4 billion debt following gazetting of the Reserve Bank of Zimbabwe Debt Assumption Act.

The new legislation took effect on August 7, 2015 and provided the framework for "the settlement of certain liabilities incurred by the Reserve Bank of Zimbabwe".

In assuming the debts the Government's objective was to clean up the reserve bank's balance sheet in order to allow the bank to resume its proper role in the financial sector and ward of a litany of legal suites.

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