Zim plans to reintroduce land bank
Financial Gazette 18/10/2018
Tabitha Mutenga
Features Editor
The Zimbabwe Land Commission is working on improving the 99-year lease by introducing a basket of rights that will make it bankable.
Banks are reluctant to accept the 99-year lease because it is not tradable.
Addressing farmers at the Zimbabwe Farmers’ Union’s 78th Congress in Gweru last week, Tendai Bare, the commission’s chairperson, said his body had previously recommended bankability of the 99-year lease to the Ministry of Agriculture but it had received reports that banks were not accepting the lease as collateral.
“As the land commission, we are bound by the Constitution to look at the country’s tenure system so that it is simplified. As a result, we are working on making the 99-year lease bankable. We have discovered that there are 25 steps that should be taken before the lease can be issued and we are working on simplifying that,” Bare said.
Security of land tenure is a pre-requisite for enhanced investment in the country’s agricultural sector.
“For 500 hectares, the farmer should pay at least $80 000 before a 99-year lease is issued and even after paying such huge amounts, the bank will still not accept the 99-year lease as land title,” she said.
Government has engaged financial institutions on the bankable 99-year lease and turning it into an acceptable land title but the engagements have only been on paper while banks continue to shy away from the lease.
“The Land Commission is working on simplifying the lease to enable farmers to access finance from banks. We also discovered that there is another limitation and we were thinking that if possible an interim measure should be put in place where government can be the guarantor.”
The commission is also working on recommending the re-introduction of the land bank where farmer would access loans for infrastructure development. This has been done in other countries such as Brazil, Malaysia and China.
“The commission is working with other tenure experts and we are thinking that government can introduce a land bank linked to the country’s tenure system and then all farmers (from A2 to communal) through their leases, land permits or offer letters should have a basket of rights that do not differentiate them but allows them to access funding,” Bare said.
The commission expects to forward its recommendations to government by the end of the year.
Government has de-racialised land ownership and recognizes that all farmers, regardless or colour, greed or origin have rights to claim the 99-year leases.