Global Journal of Commerce & Management Perspective
Open Access

Abstract

Zimbabwe’s Debt Problem: Lessons for the Future

Douglas Muyeche and Cloudio Chikeya

Zimbabwe’s debt has been considered unsustainable from within and outside the country. This study sought to establish the causes of such a scenario taking a qualitative approach through the administration of a questionnaire and interview to a purposively sampled respondent pool. The study managed to establish the root causes of un-sustainability of past loans to Zimbabwe. Conditionality in loans from lending institutions has had its fair share of blame in making debt un-sustainable. Droughts which have been a common phenomenon in Sub-Saharan Africa for the past three decades have had their contribution to the debt problem but the study concurred with Jones(2011)’s findings when it comes to sustainable means of funding droughts. Post independence, some debt which has burdened Zimbabwe was considered unjustified and odious. With supportive policies, foreign direct investment was inter-alia found to be a form of bailout capable of sustaining itself in the long run whilst addressing other economic fundamentals like employment