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Botswana Loan to Come From Banks

BOTSWANA Finance minister Baledzi Gaolathe this week said the US$70 million his country has extended to Zimbabwe will not come from government coffers.

He said the money would be sourced from banks in Botswana and extended to Zimbabwe under the Short-Term Emergency Recovery Programme (Sterp).

“We are not going to extend the loan directly as government,” Gaolathe told a press conference. “We are going to encourage our banks to extend that line of credit.”

The Botswana government would guarantee the bank loans.

“Banks will want some sort of comfort from us looking at what is happening in the international community (credit crunch). So the lines of credit are not from our resources as such,” Gaolathe said.

There was an outcry in Botswana that the government wanted to loan Zimbabwe US$70 million instead of channelling it to other uses during this belt-tightening phase.

Gaolathe said the money was not a grant, but a loan that would benefit Botswana through promotion of joint ventures between selected corporations of the two countries.

Last week, the Botswana government sent an 11-member delegation on a fact finding mission to explore how it can assist Zimbabwe.

Sadc’s extraordinary summit in Swaziland last month resolved that member states should assist Zimbabwe implement its Sterp in the form of budget support, lines of credit, joint ventures and toll manufacturing.

The resource requirements for economic recovery in the long-term were put at US$10 billion, but the government urgently needs US$2 billion to implement Sterp. – Staff Writer.

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