The government of Zimbabwe has found a strategic partner to help recapitalize the Agricultural Banking Corporation so it can help meet the needs of Zimbabwean farmers seeking crop financing, said Investment Minister Tapiwa Mashakada.
Speaking on VOA Studio 7 LiveTalk on Wednesday, Mashakada said the unidentified South African partner is expected to inject sufficient funds into Agribank, a state-controlled entity, to resolve bad debts exceeding US$80 million, mostly from unpaid loans by farmers resettled under land reform and senior government officials.
Agribank officials reached by VOA declined to comment on the impending deal.
Meanwhile, Zimbabwe has secured a US$300 million loan facility from Brazil to help farmers under the “More Food for Africa” program. The country is the first to benefit from the scheme, designed to make lines of credit available to farmers in poor nations.
The state-controlled Herald newspaper said Agriculture Minister Joseph Made signed the deal. Interest rates and other details were not disclosed.
Mashakada said Agribank as in the past could play a key role in reviving agriculture. "Allowing farmers to buy equity at Agribank can be another way of ensuring that the farmers will get loans from their own entity," he said.
Masimba Kuchera of the Zimbabwe Coalition on Debt and Development said Agribank must tighten up its lending practices once the institution is recapitalized.