Government says it is considering giving farmers security of tenure for land acquired during the chaotic fast-track land reform programme in order to unlock funding for the agricultural sector, a move that marks a landmark policy U-turn.
Since introducing the 99-year leases in 2006, government has resisted the move, arguing it would reverse the land reform by allowing dispossessed white farmers to buy back the acquired farms.
The resistance reached its climax in July when some Members of Parliament booed Finance minister Tendai Biti for recommending the securitisation of 99-year leases, sparking an uproar that almost brought the august House’s business to a halt.
But in a surprise move on Friday, Lands and Rural Resettlement minister Herbert Murerwa said government had engaged local banks to securitise the leases.
The securitisation would convert 99-year leases into transferable, tradable and bankable property without ceding title deeds and empower banks to alienate the leases if the owner defaults.
“The Ministry of Lands and Rural Resettlement is currently engaging the Bankers’ Association of Zimbabwe (BAZ) to see how this problem (of security of tenure and access to agricultural funding) can be overcome.
“There is a team working on this issue in order to see how the leases can be made bankable,” Murerwa said during his address at the Zimbabwe Commercial Farmers’ Union annual congress.
“The Bankers’ Association of Zimbabwe gave us some recommendations which we are still considering as government. We cannot disclose the recommendations as they are technical.”
BAZ president John Mushayavanhu confirmed the talks.
“It’s true we are engaging with the ministry on the 99-year leases. We want the leases to be transferable. We want the ministry to make it possible for banks to take over the lease and pass it on to the next person if the owner of the lease defaults.
“We also need clarification on the duration of the 99-year lease in terms of tenure,” Mushayavanhu said. Citing the examples of Zambia and Mozambique, Murerwa said securitised leases can serve the same purpose as title deeds.
He announced that government had approved 99-year leases for about 1 095 farmers out of 1 265 applications to date and urged more new farmers to apply for the leases to enhance collateral security.
A decade on since the fast-track land reform started, the country’s agricultural sector has suffered serious funding challenges blamed on lack of collateral.