New Zimbabwe.com

Agribank optimistic as govt re-engages foreign lenders

AGRIBANK has commended the government for seeking re-engagement with international financiers saying this would help boost agricultural productivity and sustainability.

The bank’s chief executive Somukhosi Malaba recently told the parliament’s indigenisation thematic committee that the last 15 years have been difficult for banks in terms of securing loans for agriculture.

“Over the past decade and a half, the country has not been able to access medium and long-term financing from multilateral institutions such as the World Bank and the AfDB due to accumulated external payment arrears,” said Malaba.

“Development partners which had assisted in financing agriculture during the post-independence era, in particular small holder farmers, also scaled down financing.

“For this reason, the bank supports government’s call for engagement with the international community to clear external payment arrears, redress BIPPAS that may have been violated and attract foreign direct investment.

“Once external arrears are cleared, the country can access medium to long term funding including for agriculture infrastructure development.”

Zimbabwe’s external debt increased three percent to $11, 3 billion last year – nearly 80 percent of the country’s gross domestic product (GDP) – as a result of interest on arrears, latest Reserve Bank of Zimbabwe (RBZ) data shows.