“Since the southern African nation fell into default to the IMF in 1999, it has struggled to obtain finance to support an economy”
ZIMBABWE may ask black owners who settled on land confiscated from white farmers during state-sponsored invasions to help compensate them for their losses, Finance Minister Patrick Chinamasa said as the southern African country tries to repair relations with international lenders.
The government could also issue Treasury Bills to contribute to the payments to between 3,000 and 4,000 farmers who lost their land, Chinamasa told a meeting Thursday with officials from the International Monetary Fund (IMF) in the capital, Harare.
More than 6,000 farms need to be assessed for compensation, he said. The government has already made payments to 240 white commercial farmers, Lands and Rural Settlements Minister Douglas Mombeshora said. The compensation plan is part of an effort by President Robert Mugabe’s government to restore relations with the IMF.
Since the southern African nation fell into default to the Washington-based fund in 1999, it has struggled to obtain finance to support an economy that is half the size it was 15 years ago.
Land Invasions “Government is fully committed to the re-engagement process, and this meeting is part of the initiatives that government has been exploring in order to normalise relations with the rest of the world, including our own farmers,” Chinamasa said.
Zimbabwe has pledged to repay at least $1.8 billion in debt to multilateral lenders by the end of June so that it will be eligible to seek new loans. The often-violent land invasions that began in 2000 cost the country about 300,000 farm jobs and at least a dozen lives.
The expropriations decimated production of tobacco, once Zimbabwe’s biggest export, and caused famines in a country that had been Africa’s second-biggest corn exporter. Output of paprika and roses also plummeted. Mugabe declared a state of national disaster last month due to the worst drought in almost two decades that’s killed cattle, withered crops and left millions of people needing food aid.
The government is struggling to meet monthly wage bills that consume over 80% of revenue, making compensation complicated, Chinamasa told delegates to the meeting. ”Of course, in that respect, we have to start talking about Treasury Bills,” he said. “The budget is tight.”
-Bloomberg
