ZIMBABWE’S external and domestic debt has surged to US$5.8 billion, figures released by the country’s central bank last Wednesday indicated.
The Reserve Bank of Zimbabwe (RBZ) said the country’s financial obligations had increased to US$5.84 billion from US$5.7 billion between January and March 2010.
Analysts say the country does not have the capacity of repay its external debt with at least US$3.6 billion of the amount owed being arrears.
“The huge debt is increasing Zimbabwe’s credit risk profile while undermining investment and growth,” analysts at Kingdom Financial Holdings said in their weekly report.
Western donors continue to withhold support for the country citing concerns about political stability in addition to demands that the country clear its arrears before fresh funds can be made available.
Finance minister Tendai Biti suggested the country joins the Heavily Indebted Poor Countries Initiative (HIPCI) but the proposal faced stiff resistance from sections of the unity administration.
Meanwhile activity on the Zimbabwe Stock Exchange (ZSE) was characterised by mixed trading with the benchmark industrial index gaining 3.63 percent by the close of business on Friday.
Delta Corporation – the second biggest counter on the market – attracted investors’ attention after publishing an impressive set of financials which showed volumes increasing 99.7 percent.
The week’s top five performers were led by Medtech which put on 66.7 percent followed by Pioneer, 50 percent and FBCH which gained 33.3 percent.
Losses were however, recorded in Steelnet, Gulliver, Pelhams and Caps.
Shares worth US$9.23 million changes hands compared to US$6.28 million the previous week.
Kingdom said they expect the market to continue trading sideways in the short-term as the liquidity situation remains tight.