The Bankers’ Association of Zimbabwe (BAZ) has concluded discussions with the government on the bankability of the 99-year farm leases.
BY VICTORIA MTOMBA
BAZ president, Charity Jinya told NewsDay that the Lands ministry will make an official announcement on the agreed position at the “appropriate time”.
She, however, could not disclose the nature of the agreement, saying it was the responsibility of the relevant ministry to do that.
Bankers have not been accepting 99-year leases as collateral for loans, as they are not bankable, making agriculture funding a big challenge.
But sources said under the new arrangements, the 99-year lease would be adjusted to meet the requirements of financial institutions.
NewsDay sent questions to Lands minister Douglas Mombeshora last Thursday, but he had not responded by the time of going to print yesterday.
Jinya could also not say how much money the banking sector had set aside for the 2016/7 agricultural season.
Last season, the banking sector spent $1 billion to fund agriculture, although the figure is half the amount required annually for agricultural activities.
Most farmers are failing to access loans due to lack of security, while others have failed to pay off their loans.
Meanwhile, the Zimbabwe Fertiliser Company (ZFC) said it had completed its maintenance and was well stocked for the 2016/7 season and the company was not involved in any form of contract farming, but was selling most of its products on a cash basis.
“The demand for the product is poor, as farmers are affected by the liquidity challenges. It is difficult to effect external payments for raw materials and critical spares,” ZFC managing director, Richard Dafana said.
“Resources are available, but there are challenges in effecting external payments for raw materials.”
He said while the sector welcomed Statutory Instrument 64, which banned the importation of several locally available products, its fruits were yet to be realised although an increase in capacity utilisation was expected.
Preparations for the 2016/7 agriculture season are already underway.