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Zimbabwe’s finance minister Tendai Biti said Harare will seek at least $150-million in regional aid from South Africa and Angola.

Themba Hadebe/AP

Zimbabwe is turning to South Africa and Angola for help in plugging a $400-million hole in its budget, Finance Minister Tendai Biti said on Thursday, lamenting a lack of foreign investment and aid from its traditional Western donors.

The southern African country's economy is recovering under a coalition government formed in 2009 by President Robert Mugabe and his rival, Prime Minister Morgan Tsvangirai, but is still suffering the hangover of a decade-long recession widely blamed on Mugabe policies such as the seizure of white-owned farms.

Mr. Biti, who slashed Zimbabwe's 2012 GDP growth forecast last month from 9.4 per cent to 5.6 per cent due to a poor harvest and lack of donor funding, said Harare would seek at least $150-million from South Africa and Angola.

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"I have secured an important appointment with South Africa's minister of finance two weeks from now," he told a news conference. "In this meeting we are going to make a request for budgetary support to the tune of $100-million."

Harare was also in advanced talks for a $50-million credit line from oil-rich Angola, he said.

He added that he would ask Pretoria to release a 500-million rand ($59-million) grant pledged in 2009, and revive a 1.75-billion rand credit facility created decades ago by the colonial Rhodesian government and apartheid South Africa.

The government needed nearly $400-million before the end of the year to pay annual bonuses for workers, and to finance the 2012/2013 farming season and an expected referendum on a new constitution, Mr. Biti said.

Zimbabwe has struggled to attract funding from the likes of the IMF and World Bank due to external debt that Mr. Biti put at $9.1-billion. Mr. Mugabe's drive to force foreign firms to hand over majority shares to local interests has also kept private investors away.

Zimbabwe was in danger of missing a revenue target of $3.4-billion this year, Mr. Biti said, but added that the revised growth forecast would be met due to better-than-expected tobacco sales.

Mr. Biti also said Harare was negotiating with Beijing for a $350-million loan to expand its Kariba South power station to provide an additional 300 MW of power to the current 1,000 MW – half of present demand.

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China's Sino Hydro is the sole bidder for the project.

Speaking earlier in Harare at the launch of an energy policy, Energy Minister Elton Mangoma said Zimbabwe was planning a 100 MW solar plant to be commissioned in 2013.

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