Zimbabwe is ffacing fresh legal pressure in the United Kingdom after a Libyan state-owned bank sued the government over an unpaid fuel import facility dating back to the early 2000s, with the claim now exceeding US$100 million including interest.
The Libyan Foreign Bank, a subsidiary of the Central Bank of Libya, has lodged proceedings in the UK High Court against the Government of Zimbabwe, the Ministry of Finance and Economic Development, and the National Oil Infrastructure Company of Zimbabwe, the state fuel entity.
Court documents indicate the dispute stems from a 2001 fuel credit facility worth about US$90 million, arranged at a time when Zimbabwe was experiencing acute foreign currency shortages and tightening international sanctions. The Libyan lender alleges Zimbabwe utilised roughly 50% of the facility, yet made repayments of only US$5.5 million over a ten-year period between 2013 and 2023.
As a result of accumulated interest and charges, the outstanding balance is now said to have surpassed US$100 million, effectively more than 18 times the amount Zimbabwe has repaid, according to the claim.
Related Stories
Finance Minister Mthuli Ncube is cited in the proceedings in his official capacity, underscoring the sovereign nature of the debt. The High Court has reportedly directed Zimbabwe to submit a formal defence, marking the start of active litigation.
The lawsuit comes as Zimbabwe continues to grapple with a heavy external debt burden.
Treasury data shows the country’s total public and publicly guaranteed external debt exceeds US$14 billion, with more than US$12 billion in arrears owed to multilateral lenders, bilateral creditors and commercial institutions. Zimbabwe has been in arrears to the World Bank since 2000 and to the African Development Bank since 2001, severely limiting access to new lines of credit.
Fuel imports remain a major pressure point for the economy. Zimbabwe consumes an estimated 1.3 to 1.5 billion litres of fuel annually, almost all of it imported, making access to external financing critical for energy security. Any adverse ruling in the UK case could expose Zimbabwean state-linked assets abroad to enforcement actions, analysts warn.
The Libyan claim also highlights the long tail of credit arrangements struck during Zimbabwe’s economic crisis years, many of which have resurfaced as creditors pursue recovery through foreign courts.
Leave Comments