Zimbabwe to pay white farmers US$331 million in move to rework debt

Bloomberg

Zimbabwe plans to pay $331 million to white former farmers whose land the nation seized in 2000 as a step toward getting creditors to agree to restructure the nation’s debt pile, which has left it locked out of international capital markets for more than two decades.

The country has identified at least 439 former land owners as “beneficiaries for financial settlement of $331 million,” African Development Bank President Akinwumi Adesina said Monday at a debt conference with the nation’s creditors in the capital, Harare, without disclosing the time period.

Zimbabwe has set aside $35 million in this year’s budget to begin payments, Adesina said. “The debt will be paid via bonds.”

Zimbabwean President Emmerson Mnangagwa in 2022 solicited the help of Adesina and former Mozambican leader Joaquim Chissano to spearhead the talks with creditors, including the World Bank, Paris Club, European Investment Bank and the AfDB.

Last month, the southern African country hired Global Sovereign Advisory and Kepler-Karst to help it rework its $21 billion debt pile.

The arrears have meant that the nation hasn’t been able to secure financing from multilateral lenders such as the International Monetary Fund, forcing it to resort to the central bank to fund its borrowings.

“No one, no matter how strong, can run up a hill with a backpack of sand on their back,” Adesina said, likening Zimbabwe’s $21 billion of debt — the bulk of which is arrears — to the burden.

“We can all agree that we must play our part to correct this anomaly by giving a new lease of life to this nation and its people,” he said. “Zimbabwe is too critical for the world to ignore.”