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Libya\u2019s central bank is suing Zimbabwe\u2019s finance minister and national oil company for more than $100 million, the latest development in a spiraling debt crisis that\u2019s bedeviled the southern African nation for a quarter of a century.<\/p>\n
The claim was filed in November in a UK High Court dealing with commercial issues by Libyan Foreign Bank, a unit of the Central Bank of Libya known as LFB, over loans taken out against a 2001 credit facility that Zimbabwe has allegedly failed to honor, court documents show. Justice Richard Jacobs has given the Zimbabwean defendants until the end of this month to file a defense.<\/p>\n
The country has been locked out of international capital markets because of at least $21 billion in unpaid debt, with arrears to the World Bank and other multilateral lenders accumulating over the last 26 years. It\u2019s also in dispute with a number of private creditors.<\/p>\n
Bloomberg reported in 2022 that Zimbabwe was in talks to repay Trafigura Group for unpaid fuel import bills with $226 million in gold and nickel.<\/p>\n
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The country has also reneged on a 2022 agreement to pay $3.5 billion in compensation to about 4 000 White farmers who had their land violently seized at the turn of the century in a wave of land invasions that the then president, Robert Mugabe, said was justified by the injustices perpertrated during the colonial era.<\/p>\n
The Libyan bank alleges that a Zimbabwean state-owned fuel distribution company, the National Oil Infrastructure Company of Zimbabwe agreed in 2001 to a credit facility of $90 million with LFB and drew down almost half of that sum over the next two years to pay for fuel imports from Oilinvest BV of the Netherlands.<\/p>\n
The firm has repaid only $5.5 million in four installments between 2013 and 2023 and the amount owed, together with interest, now amounts to more than $100 million, LFB said in the documents.<\/p>\n
LFB didn\u2019t respond to a request for additional comment. Neither did Zimbabwe\u2019s oil company or the finance ministry.<\/p>\n
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Simbarashe Makoni, Zimbabwe\u2019s finance minister at the time of signing, agreed that his ministry would act as guarantor to the debt. Mthuli Ncube is Zimbabwe\u2019s current finance minister.<\/p>\n
LFB alleges that since 2005, Zimbabwean state officials have repeatedly acknowledged the outstanding debt in correspondence with the lender.<\/p>\n
Ncube has accepted that the case can proceed in the UK court after initially planning to contest its jurisdiction, according to Justice Jacob\u2019s order.<\/p>\n
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