Zimbabwe govt defers ex-farmers' compensation

GOVERNMENT has deferred to July 2022 the first payment towards compensating white former commercial farmers who lost their land during the land reform programme in the early 2000s.

Government was supposed to begin com pensating the affected farmers in July this year after signing an agreement to compensate them for the developments made on the farms before the country's chaotic fast track land reform programme.

President Emmerson Mnangagwa signed the Global Compensation Deed (GCD) in August last year where he made a commitment to pay the farmers US$3,5 billion, starting July this year.

In a statement yesterday, Finance minister Mthuli Ncube said the parties to the GCD had settled to further defer the payments to 2022 as Covid-19 had slowed down the acquisition of financial resources.

"The longer than had been anticipated pe riod for the appointment of the financial advi sors alluded to above and the Covid-19 pan demic slowed down the resource mobilisa tion process," Ncube said.

"The parties to the GCD, therefore, agreed to extend the period for the first payment from July 31, 2021 to July 31, 2022. The par ties signed an addendum to the GCD on May 7, 2021 to give legal effect to their agreement."

Last month, government set aside US$1 million from the first dividend declared by Kuvimba Mining House towards compensating the farmers.

"An amount of US$1 million was declared in favour of the fund for compensating former farm owners and this amount will be applied in favour of the fund for compensating former owners, and towards the partial settlement of the global compensation figure. Subsequently, dividends will be paid quarterly and applied in the same manner."

In the 2021 national budget statement, Ncube committed $2 billion towards compensating the former farmers.

These resources are currently being disbursed to distressed former farm owners as interim relief payments.

Ncube said in compliance with the Public Procurement and Disposal of Public Assets Act, the procurement of the financial adviso ry series for the joint resource mobilisation process began with the issuance, through
the Ministry of Finance, of an international call for expression of interest in September 2020.

"Nevertheless, we are pleased to advise that the process has now been completed and the contract with the financial advisers, New State Partners, was signed on April 21, 2021. The financial advisers have already commenced work with the JRMC supporting its capital raising efforts."

Ncube said a number of possible financing instruments and funding options were already being worked on together with the financial advisers. These, he said, included, but were not limited to, bonds issued domesti cally, both listed and unlisted, bonds listed at international markets, both listed and un listed, listed and unlisted equity, and quasi-equity type instruments, structured financial agreements, including the issuance of as setbacks securities, and off-balance sheet financing arrangements using commercial guarantees.