THE Zimbabwean government will this month begin paying $20 million in compensation to foreign white and local Black farmers who lost their land during farm invasions at the turn of the century under former leader Robert Mugabe. The finance minister, Mthuli Ncube, announced on Friday that this initial payment is part of the 2024 budget, aimed at restoring the country’s once-thriving agricultural sector and facilitating long-promised economic revival.
Zimbabwe’s agricultural collapse began in 2000 when Mugabe sanctioned the seizure of highly productive commercial farms, most of which were owned by white Zimbabwean farmers. These farms had originally been forcibly taken from Black Zimbabweans by colonial settlers in the early 20th century. However, the chaotic land seizures, which often benefited individuals linked to the ruling ZANU-PF party, also affected foreign white farmers and some local Black Zimbabweans.
Compensation and economic revival
The victims eligible for compensation include foreign farmers from Belgium, Germany, and other countries, as well as 400 Black Zimbabweans who lost property during the invasions, said Finance Minister Mthuli Ncube.
In 2020, a separate and much larger $3.5bn compensation scheme was announced for 4,000 white Zimbabwean farmers. However, due to Zimbabwe’s ongoing financial difficulties, this compensation has not yet been paid. The new $20 million allocation is a step towards addressing grievances and rebuilding trust with the agricultural community, crucial for reviving the economy.
Efforts to rebuild ties and secure debt relief
Since coming to power in a 2017 coup, President Emmerson Mnangagwa has sought to engage with Western governments to rebuild relations, resolve Zimbabwe’s substantial foreign debt, and boost economic prospects. However, last year’s general elections, which international observers deemed neither free nor fair, have hampered Zimbabwe’s efforts to attract potential donor assistance.
Ncube expressed optimism, saying, ‘The dialogue process is working and will help us in clearing our arrears eventually.’
Zimbabwe has been excluded from the global financial system for more than two decades after defaulting on its debts. This isolation, coupled with economic mismanagement, has deterred much-needed international assistance. The country is now seeking a staff-monitored programme with the IMF as an initial step towards debt relief. Ncube confirmed that an IMF team is set to visit Harare in the next two weeks.
‘A staff-monitored IMF programme is necessary to help us clear our debt arrears, which are an albatross around our economy,’ Ncube said.
Zimbabwe’s debt challenge
Zimbabwe’s total foreign debt currently stands at $12bn, owed to institutions including the World Bank, African Development Bank (AfDB), and 16 Paris Club member nations, as well as other private creditors. Clearing these arrears is a crucial step for Zimbabwe to re-engage with the international financial system and lay the groundwork for economic recovery.
The payment of compensation to farmers and seeking IMF support reflects Zimbabwe’s efforts to repair its economy, restore the agricultural sector, and regain credibility on the international stage. However, overcoming its financial challenges and rebuilding trust with both local and foreign investors remains a significant hurdle for the southern African nation.
