UK firm to help raise US$ 3,5bn for farmers

THE Government has engaged a British financial advisory firm to assist in raising the US$3,5 billion needed to pay former farm owners whose land was compulsorily acquired for resettlement as agreed between the two parties in the Global Compensation Deed signed last year.

In an update on the implementation of the GCD yesterday, Finance and Economic Development Minister Professor Mthuli Ncube said the Government had engaged Newstate Partners as from April 21 this year.

The firm says on its website that it is an independent advisory firm dedicated to the provision of impartial, specialist financial advice to governments, central banks, sub-sovereign or state-owned clients and other parties-at-interest primarily on issues of debt management and infrastructure financing.

The former farm owners who are indigenous Zimbabweans or citizens of countries that had ratified Bilateral Investment Protection and Promotion Agreements or Bilateral Investment Treaties with Zimbabwe at the time their land was compulsorily acquired are entitled for compensation for land and improvements in line with the country’s laws.

Prof Ncube said the appointment of the financial advisors was done in compliance with the Public Procurement and Disposal of Public Assets and began with an international call for Expressions of Interest in September last year.

He said despite delays in their appointment the financial advisors had already commenced work with the Joint Resources Mobilising Committee supporting its capital-raising efforts with a number of funding options being worked on.

“These include, but are not limited to bonds issued domestically (both listed and unlisted); bonds issued into international markets (both listed and unlisted); listed and unlisted equity and quasi equity type instruments; structured financial arrangements, including the issuance of asset backed securities, and off balance sheet financing arrangements using commercial guarantees,” he said.

Prof Ncube said these structures will augment and complement the resources that have already been secured by Government.

In the 2021 National Budget, Government committed $2 billion towards the compensation of former farmers and the resources are currently being disbursed.

In addition, Government also secured US$250 million towards the compensation process through the donation of a shareholding of equal value in Kuvimba Mining House, to a special purpose vehicle specifically created to raise funds for the compensation.

In the statement, Prof Ncube said Government had also received US$1 million that will go towards the compensation from a dividend paid on its shareholding.

“An amount of US$1 million was declared in favour of the fund for compensating former farm owners and this amount will be applied towards partial settlement of the agreed global compensation figure.

“Subsequently dividends will be paid quarterly and applied in the same manner,” Prof Ncube said in the statement.

The signing of the GCD marked a turning point in the restoration of trust and cooperation between the former farm owners and Government.

Prof Ncube said it also consummated Government’s desire and commitment to move the Vision 2030 agenda forward and to ensure its timely realisation through increased agricultural productivity, among other initiatives.