Roundup: Zimbabwe compensates white farmers in land reform, may impose new levy

The Zimbabwean government has begun compensating former white commercial farmers who lost land under the controversial land reform program at the turn of the century, but the government may impose a new farming levy and issue treasury bills to amass funds, cabinet ministers said on Thursday.

Lands and Rural Resettlement Minister Douglas Mombeshora said to date, the government had fully paid compensation to 240 former white commercial farmers and partially compensated 17 others.

The government, he said, acquired 6,240 farms, which are approximately 14.5 million hectares of land that belonged to former white commercial farmers during the land reform program, out of which 1,519 farms had been evaluated to be eligible for compensation.

The minister was speaking at a one-day workshop to gather input from stakeholders in order to come up with a consensus on the compensation mechanisms.

The compensation pledge is included in the debt clearance strategy the government submitted to its multilateral creditors in Lima, Peru last year.

In the debt strategy, Zimbabwe has pledged to clear its 2.8 billion U.S. dollars in arrears to the multilateral creditors (World Bank, IMF and AfDB) as part of efforts to unlock fresh funding from the creditors, who stopped lending to Zimbabwe more than a decade ago due to the arrears.

Zimbabwe undertook a decade-long land reform program from 2000 to redress colonial land imbalances.

During the process that was often punctuated by violent seizures of farms owned by white commercial farmers by indigenous Zimbabweans, government repossessed nearly 14.5 million hectares of land, which it redistributed to the landless black majority, benefiting more than 300,000 households.

Mombeshora said the compensation process was being derailed by shortage of funds, but thanked development partners including the United Nations Development Program (UNDP) that had provided 7.8 million U.S. dollars for evaluation of the farms.

The minister, however, did not provide an estimated total amount for the compensation.

Finance Minister Patrick Chinamasa said given the unfavorable economic conditions obtaining in the country, the government would have to explore several possible financing options, including taxing the new black farmers and issuing Treasury Bills to raise compensation funds.

He implored the stakeholders to come up with a compensation mechanism that takes into account the harsh economic conditions prevailing in the country characterized by tight liquidity challenges, low growth rate and a high debt burden.

UNDP resident representative Bishow Parajuli said resolving the land reform issue was key in alleviating poverty and advancing development in the country.

"As Zimbabwe gears towards implementing its development agenda to achieve sustainable development goals, land reform could play a vital role in its success," he said in a speech.

He urged the country to be innovative in mobilizing funds for compensation given the constrained domestic resources. Endit