Zim pays off US$19 million blocked funds

Spread This News

By Alois Vinga

FINANCE Ministry permanent secretary, George Guvamatanga Friday revealed that a total US$19 million blocked funds have been paid off to date with some owed entities being offered Treasury Bonds (TBs) to expedite the process.

Blocked funds or legacy debts accrued after entities US$ denominated balances were automatically converted to Zim$ when the economy dedolarised in June 2019, resulting in the government assuming the debt of US$51 million in a move aimed at protecting foreign companies operating in Zimbabwe.

The process was necessitated by listing of such due dates through the Reserve Bank of Zimbabwe (RBZ) in line with set out regulations.

“All claimants of less than US$1 million will be paid in cash, over the period of five years beginning June 2022 basing on the RBZ approved and registered claimants list as of June 30, 2022, amounting to US$51 million.

“To date, the Treasury has made payments amounting to US$19 million with a balance of US$32 million which will be paid from April 2023 to September 2026,” Guvamatanga said.

He said all claimants with amounts above US$1 million were issued with zero coupon Treasury Bonds (TBNs) ranging from 3 to 20 years based on the outstanding amount.

The treasury bonds are tradable, have liquid assets and prescribed asset status with those owed US$1 million to US$1,9 million having a tenure of three years, US$2 billion to US$2,9 billion tenure of three and a half years.

Amounts of US$4 to US$4,9 million have a tenure of between three and 10 years with more than US$8 million 3 to 20 years.

The Treasury Secretary however warned entities trying to manipulate the agreed payment framework and discouraged the practice of appointing third parties to interfere with the agreements.

“Treasury has noted a significant amount of appeals from claimants for the deviation from approved modalities. These appeals cannot be acceded to and are not sustainable.

“These appeals cannot be acceded to and are not sustainable. The claimants are therefore advised that Treasury will adhere to approved settlement modalities,” added Guvamatanga.

He added that claimants are therefore advised to directly approach treasury if there are any issues/discrepancies requiring attention saying this will assist in ensuring that all the claims are diligently settled in line with Treasury’s Governance Charter.