The debate on sanctions on Zimbabwe has been there and is likely to continue for a long time. Whilst the government and the ruling ZANU PF have always called for the unconditional removal of sanctions “imposed on Zimbabwe” by Western powers, the United States and other countries which imposed those sanctions maintain that sanctions were imposed “on individuals within the government and on some entities”.
The question of whether they were imposed on Zimbabwe or Zimbabwe nationals and companies is for another day as this article intends to present opinions put forward in an article in today’s Herald. The article highlights a number of issues that were created by sanction. See below.
The article says that sanctions had a significant role in the deterioration of the economy.
- Credit facilities dwindled: access to international credit markets was blocked after the enactment of ZIDERA.
- A decline in Balance of Payment (BOP) Support: BOP position has deteriorated significantly since the introduction of sanctions.
- Reliance on Domestic Funding: as traditional sources of external finance, International Financial Institutions stopped giving support to Zimbabwe.
- Failure to service Debt obligations: Shrinking sources of funding created the debt issue as the country defaulted on debt payment. Huge Arrears, in turn, forced creditors to suspended Balance of Payments support and technical assistance.
- The decline in Standards of living: as a result of the sustained decline in long-term capital inflows.
- Brain drain: Skilled workforce left the country in search of greener pastures.
- Difficulties to make payments through the international payment platforms as these transactions are intercepted and blocked.
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