OPINION: Inside Zimbabwe’s $3.5 bn deal for farmers- Ben Freeth

PUBLISHED: Thu, 30 Jul 2020 14:23:37 GMT

At a signing ceremony in Harare on the 29th July, the Commercial Farmers Union President, alongside other former Commercial Farmers signed a deal with the Zimbabwe Government to say that a compensation amount of 3.5 billion US dollars would be sought to pay compensation to commercial farmers who had been evicted from their farms.

On the face of it, it all sounds quite hopeful; except for the fact that the Zimbabwe Government hasn’t got any of the 3.5 billion to pay.    There is a solution here though: a joint team of Commercial Farmers and the Zimbabwe Government is launching an offensive to head off to raise the money from wherever they can.
Zimbabwe commercial farmers, now spread across the globe, are itching to get sight of the agreement.  Only a few have so far been allowed to see it, despite many calls for it to be scrutinised independently.  This has created a high degree of mistrust as to what is really happening.

Ben Freeth

One lawyer I spoke to did manage to go around to the Commercial Farmers Union and look at the agreement.  He came away shaking his head.  He told me that the agreement [that has subsequently been signed] was outside the framework of the Zimbabwe Constitution and Zimbabwe law.  The laid down procedures for compensation in Zimbabwe’s own Constitution have been bypassed. Secondly the exchange control act doesn’t allow money to be paid in US dollars, particularly of its paid outside the country to farmers scattered far and wide.  There have many cases already where contracts in US dollars have been converted to Zimbabwe currency at hugely prejudicial rates.  Thirdly, parliament hasn’t given any assent to seeking a loan agreement of this magnitude;  and fourthly the agreement seems to lock the title deed owner in to just getting money for improvements and nothing for the land or stolen crops, livestock, machinery or other losses associated with the forced evictions.

Assuming these legal aspects are able to be sorted out, what about the amount being agreed?  Under international law it is unquestionably a very poor deal.  Heinrich Von Pezold did a full claim under international law due to a bilateral investment treaty and was awarded a sum of close to 200 million US dollars.  Admittedly he was a large Investor,  but if the same criteria of international law were used for the rest of the farmers, the bill would be at least 5 times the current amount – and probably considerably more.  

So what are the chances of money being able to be raised?  Zimbabwes foreign debt stands at 7 billion – but perhaps quite a lot more. Our credit rating is down with the very worst of the defaulters.  All recent attempts to borrow more money have been a failure.

On top of that there is the Zimbabwe Democracy and Economic Recovery Act.  This is Marshall type plan to rebuild Zimbabwe; but the plan needs Zimbabwe to put the right foundational rule of law parameters in place. 

One of these is following the international law judgments of the Southern African Development CommunityTribunal.  This lays down how property rights should be respected – and that fair compensation should be paid according to international law.  
In a country where the people are hungry, the economy is collapsing and the army and the police are on the streets committing human rights violations against the people, there will be precious little appetite to put money towards compensating a bunch of white farmers.  If there was a real will to restore property rights,  come back to the rule of law and utilise the skills base that’s currently dormant, it might well be a different story;  but it seems that this is simply another propaganda exercise by the Zimbabwe Government to have people believe that all is now well in Zimbabwe.  

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