Finmin Ncube on who will fund Zim’s $3.5bn compensation to white farmers

Zimbabwe has taken a significant step towards reconciliation by agreeing to pay $3.5 billion in compensation to white farmers who lost their land during the land reform invasions 20 years ago. This move is part of an effort to address the longstanding issue of property rights and bring closure to a contentious chapter in the country's history. In a recent interview on CNBC Africa, Zimbabwe Finance Minister Mthuli Ncube shed light on the details of the compensation plan and the funding strategy. The agreement, which has been in the works for the past two years, aims to compensate the former white farmers for the improvements made on the land. Minister Ncube emphasized that this compensation is a constitutional requirement that the government is committed to fulfilling. The funds, totaling $3.5 billion, will be raised through a joint resource mobilization committee formed by the government and the farmers. The committee's first meeting is scheduled to take place soon, with plans to explore local and global financing structures. These may include the issuance of a global debt instrument, such as a 30-year bond, to attract investors. Minister Ncube highlighted the potential economic impact of the compensation, noting that the money injected into the economy could benefit various sectors, particularly agriculture. The involvement of both local and global financing sources demonstrates Zimbabwe's commitment to upholding the rule of law and fostering economic growth. Veteran farmer Ben Freeth also expressed his views on the compensation agreement, raising concerns about the specifics of the deal. He pointed out potential legal hurdles, such as the need for changes in the Exchange Control Act to facilitate US dollar payments and parliamentary approval for loan agreements. Freeth highlighted the discrepancy between the $3.5 billion compensation amount and previous international rulings, suggesting that the current sum may not fully address the farmers' losses. Additionally, he underscored the importance of restoring property rights in Zimbabwe to facilitate long-term development and investment. Minister Ncube responded to these concerns, assuring that the compensation agreement is legally binding and will be honored in US dollars as stipulated. He emphasized the government's compliance with constitutional obligations and transparency in the negotiation process. While acknowledging the need for property rights reforms, Minister Ncube defended the government's approach to supporting farmers through mechanisms like 99-year leases. He reiterated the government's commitment to sustainable agriculture and economic recovery, inviting stakeholders to collaborate in achieving these goals. As Zimbabwe embarks on this landmark compensation journey, the minister's reassurances and farmer feedback signal a pivotal moment in the nation's path towards reconciliation and economic progress.