Mthuli turns to Japan
LIVINGSTONE MARUFU
Finance Minister, Professor Mthuli Ncube, is courting Japan to act as an anchor partner in underwriting Zimbabwe’s arrears clearance strategy, an effort that could unlock critical bridge financing and restore access to long-shut international funding channels.
Harare is seeking to mobilise short-term funding to settle outstanding arrears owed to the World Bank, the African Development Bank, and a range of bilateral creditors, including members of the Paris Club and non-Paris Club lenders.
Appealing directly to Japan’s ambassador Nobutaka Maekawa, Professor Ncube said Harare sees Tokyo not merely as a financier, but as a diplomatic “champion” capable of galvanising broader international support.
“We have, of course, you (Japan’s ambassador Nobutaka Maekawa) and your government to see if we can explore the possibility of Japan being one of the champions for our arrears clearance programme,” Professor Ncube said. “Champions both at the level of advocacy and who knows Japan could throw a few cents in our direction in order to find that important bridge.”
While authorities declined to specify the quantum sought from Tokyo, market speculation suggests Harare could be angling for support exceeding US$500m. Officials, however, emphasise that the broader financing requirement stands at approximately US$2.5bn, a sum expected to be assembled through a consortium of partners rather than a single backer.
“There will be no specific figure,” Professor Ncube said.
“Each financial partner we engage is up to it to decide the form of support it can give us, whether it’s advocacy or finance.”
Zimbabwe’s total public debt has risen to roughly US$23.4bn, with arrears accounting for US$7.7bn. External obligations stand at US$13.6bn, largely owed to multilateral and bilateral creditors, while domestic debt is estimated at US$9.8bn.
The origins of the crisis stretch back to the early 2000s, when economic collapse and political tensions triggered widespread defaults, effectively severing Zimbabwe’s access to global capital markets.
The consequences have been profound. For more than two decades, Harare has been locked out of concessional finance, constraining infrastructure investment, limiting foreign direct investment inflows, and amplifying macroeconomic volatility marked by inflation spikes and currency instability.
The bridge financing plan is therefore seen as a critical inflection point. By clearing arrears, Zimbabwe would regain access to low-cost, long-tenor funding from multilateral lenders — a shift that could materially alter the country’s fiscal trajectory.
Momentum has been building behind the process, with the African Development Bank, under former president Akinwumi Adesina, playing a central role in facilitating dialogue between Harare, its creditors and international partners.
This coordinated engagement has helped rebuild a measure of confidence in Zimbabwe’s willingness to confront its debt overhang, though execution risks remain significant.
Authorities are also hedging against potential setbacks.
Professor Ncube revealed that alternative pathways are under consideration, including securitising national assets or pursuing structured asset disposals to raise funds through commercial channels.
Another strand of the strategy hinges on improving macroeconomic fundamentals. Zimbabwe’s debt-to-GDP ratio, currently estimated at around 45%, is projected to decline if growth momentum is sustained, a development that could strengthen the country’s debt sustainability profile.
Yet the success of the re-engagement effort will depend as much on policy credibility as on financing.
International lenders are likely to demand tangible progress on reforms, including stronger public financial management, improved governance standards, currency stability and sustained fiscal discipline.
These measures are widely viewed as prerequisites not only for unlocking funding, but also for ensuring that any financial support translates into durable economic recovery.
Years of constrained fiscal space have already taken a toll. Key sectors such a health and education remain underfunded, infrastructure has deteriorated, and social safety nets are thin.
For the private sector, particularly small and medium enterprises, limited access to affordable capital continues to stifle expansion and job creation.
Zimbabwe’s prolonged exclusion from global capital markets has also meant that when it does borrow, it faces elevated costs, reflecting persistent risk perceptions linked to debt distress, policy uncertainty and currency volatility.
