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‘Don’t politicise SMEs $90m loan facility’

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OPPOSITION legislators have warned the Zanu PF government against politicising a $90 million loan facility recently advanced to small and medium enterprises (SMEs) by the Reserve Bank of Zimbabwe (RBZ).

OPPOSITION legislators have warned the Zanu PF government against politicising a $90 million loan facility recently advanced to small and medium enterprises (SMEs) by the Reserve Bank of Zimbabwe (RBZ).

BY VENERANDA LANGA

Budiriro legislator Costa Machingauta (MDC-T) raised the issue last week when SMEs ministry permanent secretary Evelyn Ndlovu appeared before the Parliamentary Portfolio Committee on SMEs to give an update on disbursement of the loans.

“We are saying we want to reduce poverty and so the SMEs ministry must ensure there is no politicisation of the funds,” Machingauta said.

“We do not want to see the $40 million gold support facility benefiting members of a single political party as we go towards elections.”

Ndlovu assured legislators that her ministry would guard against partisan distribution of the loans.

In January, the RBZ provided $90 million to support SMEs in horticulture ($10 million), cross-border facility ($20 million), Women Empowerment Fund ($15 million), and the business linkages facility ($10 million).

A $20 million gold facility to support small-scale and artisanal miners to increase gold production was also introduced, although the amount was later increased to $40 million.

“Lenders will accrue an interest rate of 10% and, in the event of a breach, the outstanding balance will attract an interest rate of 15% per annum,” Ndlovu said.

The horticulture facility is meant to support horticulture farmers producing flowers, vegetables, fruit and nuts.

The $15 million cross-border facility, disbursed by Agribank and Homelink, attracts a 10% per annum interest rate.

Ndlovu said her ministry was making efforts to ensure that other cross-border organisations apart from Killer Zivhu’s Cross-Border Traders’ Association benefit.

On the $3 million loan facility from the Arab Bank for Econonmic Development in Africa which was negotiated and approved in 2014, the committee was told that it was yet to be operationalised.

Small and Medium Enterprises Development Corporation general manager Gladys Kanyongo told the committee the Finance ministry was assisting in negotiating for the release of the funds.

“It is hoped that, finally in 2017, disbursements can be made to assist the SME sector in Zimbabwe. Negotiations are at an advanced stage for the $1,5 million common fund for commodities leather value chain fund,” she said.

The SMEs ministry also secured a $7,6 million loan from the Opec Fund for International Development, which is earmarked to support projects in Masvingo, Matabeleland North and Manicaland provinces.