Zimbabwe to receive US$102m farming equipment in two weeks

Deputy Minister Vangelis Peter Haritatos

Zimbabwe is set to take delivery of farming equipment worth a combined US$102 million within two weeks from John Deere and Belarus, as Government deepens efforts to boost productivity and ensure food security. 

This was said by Lands, Agriculture and Rural Resettlement Deputy Minister, Vangelis Haritatos, yesterday during Agribank’s annual general meeting in Harare.

John Deere, a top United States agricultural equipment maker, thrashed a US$50 million farm mechanisation deal with Government in February this year.

Belarus, one of the five Eurasian countries visited by President Mnangagwa in January this year, will also provide equipment worth US$52 million.

Both deals include tractors, combine harvesters and planters.

The equipment comes at an opportune time ahead of the 2019/2020 summer cropping season.

Deputy Minister Haritatos said tractors are in excess of 1 000 while combine harvesters “are quite a sizeable number” and hundreds of planters.

Preliminary indications are that the facilities will attract an interest rate of below 10 percent, which is considerably low given that the Reserve Bank of Zimbabwe (RBZ) increased interest rates to 50 percent from 15 percent this week to stem speculative tendencies. 

Agribank, which is owned 100 percent by Government, has been given the responsibility of distributing the equipment. 

Deputy Minister Haritatos said agriculture is the national backbone “and for us to take the economy forward, we have to get agriculture right. . .”

He added that Agribank will be “very instrumental in supporting our farmers”.

“In addition to the support they (Agribank) offer to our farmers through the normal banking channels, we will soon be channelling a lot of machines in terms of mechanisation such as tractors, combines and planters through various MoUs that we have signed.

“John Deere is a US$50 million facility, (and) the Belarusian facility is US$52 million. We expect the delivery of the John Deere and Belarusian equipment in two weeks,” he said.

Deputy Minister Haritatos who flew to Minsk, Belarus, last month to assess progress on the equipment said the order is over 50 percent complete, and ready to be shipped.

He said forex challenges have impacted on the seamless movement of the deals, but implored Treasury and the RBZ to assist in availing forex.

Asked what mechanisms have been put in place to ensure the equipment is distributed to competent farmers that have not benefited from previous schemes, Deputy Minister Haritatos said the coming in of Agribank is expected to address that.

“We are happy because that is going to be done independently, in a transparent manner and we encourage our farmers to take up the opportunity that has been given to them.

“We do acknowledge that there were problems in the past and to avoid those problems going forward, we have ceded a lot of that responsibility to Agribank, who will work independently and transparently so that there are no links to my family members, or family members within our ministry, it must be done on a professional basis.” 

He explained that Agribank will use its experience in the lending sector to “truly assess” the beneficiaries.

Agribank CEO, Mr Sam Malaba said as part of due diligence they will look at an applicant’s production record and loan repayments with other banks.

A credit reference bureau introduced by the RBZ helps banks to detect customers that default on loan repayments.

Meanwhile, Deputy Minister Haritatos said he was happy that Agribank recorded a US$13 million profit last year, which is uncharacteristic of most parastatals.

The bank also reduced non-performing loans to 9 percent from 13 percent in the year earlier.