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Blessing Bonga Business Reporter
BRAZIL has extended a US$98,6 million agricultural credit facility to Zimbabwe which will be disbursed in three tranches at six-month intervals and will benefit small-scale farmers under the Exporting Financing Programme sponsored by the More Food International Programme meant to strengthen family agriculture, food and nutritional security.

A signing ceremony of the Memorandum of Understanding between the Brazilian and Zimbabwean government officials to formalise the deal will take place in Brazil tomorrow. Brazilian officials from the Ministry of Development, Industry and Foreign Trade and Zimbabwe’s Ambassador to Brazil will represent the Ministry of Finance.

Speaking in Harare yesterday, Brazil’s Ambassador to Zimbabwe, Ms Marcia Maro da Silva, confirmed the developments and hailed the move as a very important initiative towards strengthening and widening bilateral economic relations that exist between the two countries.

“I can confirm to you that Brazil has approved the granting of a credit facility worth US$98,6 million to Zimbabwe that will target the small-scale farmers and I am happy to say that this is the first time the Brazilian government has extended a concessionary credit facility to Zimbabwe.

“The money will be transferred to Zimbabwe in three tranches over a period of one-and-a-half years while it will attract a favourable interest rate of only 3 percent per annum and the loan is payable over 15 years,” she said.

Ambassador Maro da Silva added that the letter of credit will be issued through the Agricultural Bank of Zimbabwe (Agibank) notified and negotiated along with the Banco do Brasil SA enough for supporting                                                                                                                   the credit value and interests during the financing period.

The first disbursement, which should be coming before the end of the year, will amount to US$38,6 million while the remainder will be availed in two tranches of US$30 million each.

The facility will also see Zimbabwean farmers benefiting from technological assistance as agricultural machinery and equipment would be financed by Brazil through the facility.

The ambassador also said the granting of such a facility was a sign that Brasilia had confidence in Zimbabwe as a country and added that they will continue partnering the country in other projects as witnessed by two Brazilian companies – Camargo Correa and Andrade Gutierrez – which have already submitted their bids for the Batoka Power Station project.

Haingate Investments managing director Mr Dan Kasukuwere, whose company is a distributor of Brazilian-made agricultural equipment in Zimbabwe, hailed the gesture by the Brazilian government and expressed optimism that the money will go a long way in ensuring that the country regains its breadbasket status within the region.

“This is a commendable move by Brazil and I am confident that we can reclaim our breadbasket status in the region as people here are very hardworking.

“The major drawback that has been a constant hindrance to our farmers has been the issue of funding and such a credit facility could not have come at a better time,” he said.