Sanctions affect loan re-payments Foreign Affairs and International Trade Minister, Ambassador Frederick Shava

Senior Reporter

ILLEGAL sanctions imposed on Zimbabwe by the United States of America have resulted in complications with repayments for a US$98 million Brazilian loan facility under the More Food Africa programme, Foreign Affairs and International Trade Minister Dr Frederick Shava said yesterday.

Speaking during a courtesy call by visiting Brazilian Secretary for Africa and the Middle East in the Ministry of External Relations, Ambassador Carlos Duarte in Harare, Ambassador Shava said Zimbabwe was grateful for the 15-year loan facility in 2015 to support at least 22 000 small-scale farmers with equipment, including tractors, fertiliser spreaders and irrigation kits.

 “The Government of Zimbabwe and its people are sincerely grateful to Brazil for the expression of support, this mutual support. I regret, however, that there have been challenges in repayments for the loan and interest for the equipment supplied to Zimbabwe,” Dr Shava said.

“This was and is due to complications associated with the sanctions imposed on Zimbabwe by the US and that tended to slow down or complicate our repayment programme. “An attempt by our commercial bank, the AFC Commercial Bank, to remit funds in January 2023 was not successful because the funds were returned by the United States immediately to the intermediary bank, citing their international compliance policy, that is, compliance with the sanctions regime.”

The Reserve Bank of Zimbabwe had proposed using Chinese Yuan instead, to repay the loan.

“The Reserve Bank of Zimbabwe had proposed that the Brazilian bank, handling the More Food International Programme payments, Banco do Brasil, open a Yuan account with the Chinese bank in order to enhance its corresponding banking relationship with our AFC Commercial Bank. We are still waiting for the response to this request,” he added.

Dr Shava reassured Amb Duarte that Zimbabwe was committed to settling its obligations under the loan agreement as it was in its interest to do so, so that the country benefits from the second tranche of the facility.

Zimbabwe has lost opportunities of over US$40 billion due to the illegal sanctions imposed on the country over 20 years ago.

Ambassador Duarte is in the country leading a delegation for the first session of political consultations between the two countries.

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