99-year leases now bankable

99-year leases now bankable Minister Chinamasa
Minister Chinamasa

Minister Chinamasa

Elita Chikwati and Brenda Ziga
FARMERS can now use the 99-year leases to borrow money from the banks after Government and bankers ironed out sticking points that made banks reluctant to accept the leases as security.

The move, barring El Nino-induced drought, is expected to boost agricultural production and ensure maximum land utilisation.

In an interview yesterday after addressing the 29th Joint Staff College course students in Harare, Finance and Economic Development Minister Patrick Chinamasa said Government and bankers had cleared outstanding issues and came up with a draft tradeable document.

“We have successfully, in consultation with the Ministry of Finance and Economic Development, Ministry of Lands and Rural Resettlement, Ministry of Agriculture, Mechanisation and Irrigation Development and the Bankers’ Association of Zimbabwe (BAZ) come up with a draft that incorporates tradable features. This means that when granted the 99-year lease one can use it as a document to go and borrow money.

“The major challenge affecting agricultural production right now is lack of funding. So, to encourage commercial banks to fund agriculture, we need to come up with appropriate legal issues that make it possible,” he said.

BAZ executive director Mr Sij Biyam could not confirm the development yesterday but asked for questions in writing.

Cde Chinamasa allayed fears that farmers may lose their land after failing to pay back loans and said farmers should be willing to work hard and settle their debts.

“The issue about farmers losing their land means we will be planning to fail or planning not to pay back loans. We are not planning to fail.

“Farmers should develop a culture of paying back loans. It is a bad culture to default as this will affect economic growth. We will certainly build safeguards with respect to who will buy the land if the farmer loses it. We will never allow anyone with a farm to purchase a farm or hold another piece of land,” he said.

Cde Chinamasa said agriculture was the mainstay of the economy and Government was assisting the sector to boost productivity.

“We cannot allow the 14,5 million hectares of land to become another communal area, to become dead capital.

“Boosting productivity is not a once-off thing. As we face new challenges, we must confront those challenges in a way of getting out. The objective has always been to be productive,” said Cde Chinamasa.

He said Government was also in the process of remapping farms with financial support from the European Union and the United Nations Development Programme.

Treasury has also provided resources to beef up the capacity of this remapping exercise.

Cde Chinamasa said the results of the exercise would inform key policy decisions such as valuations, compensation, issuance of permits and tradeable lease agreements.

He said by giving farmers permits and leases, they would have security of tenure and be able to develop their farms.

“It is not fair for someone to have a piece of land which can be taken away from him willy-nilly. The offer letter states that the piece of land can be withdrawn by the minister at any time.

“This shows farmers do not have security. Because they do not have security, they will not invest into the agricultural land. If we continue like that, it means we cannot improve agriculture production. We want to make agriculture the mainstay of the economy, to make it productive and to give farmers security against ourselves as Government,” he said.

Cde Chinamasa said the agriculture sector was important as 70 to 90 percent of the population depended on the industry.

He said Government was also working on encouraging irrigation as rain-fed agriculture was becoming unviable due to climate change.

“We are also looking at value addition. We should transform ourselves from exporting raw materials but should add value to the products,” he said.

Cde Chinamasa said Government would continue to improve the macro-environment by promoting policy clarity and consistency, protection of investment, addressing cost and ease of doing business as well as infrastructural bottlenecks among others.

“Zimbabwe is poised to achieve rapid and inclusive growth. The initiatives that Government is introducing will help mitigate the effects of drought given the importance of agriculture in Zimbabwe as well as setting a strong foundation for sustainable development,” he said.

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