Delays in addressing land concerns deter investors.

LIVINGSTONE MARUFU

Potential investors are being put off by delays in  resolving  the security tenure of  land , a Cabinet Minister has said.

Owing to the problems ,banks  have agreed not to  recognise the  99-year leases as  these are bankable  documents that can be  used as collateral by the financial institutions.

In the latest government report, Lands, Agriculture, Fisheries, Water and Rural Development Minister, Dr Anxious Masuka said the delays in bringing a finality to the land issues is scaring away potential investors.

“Land, among the issues that continue to disrupt smooth farming are boundary disputes, inheritance matters, and perceived insecurity of tenure [permits and 99 leases]. A new Land Policy and consequential legislative changes are envisaged to permanently address these matters and set the stage for more investments on land to increase production and productivity,” Dr Masuka said.

It follows discussions that have been ongoing since 2021 among the  ministries of Finance, Economic Development  and Investment Promotion and Lands, Agriculture, Fisheries, Water and Rural Development  and the Reserve Bank of Zimbabwe  while the Bankers Association of Zimbabwe (BAZ) and the Law Society of Zimbabwe being  the private sector representatives.

But, the discussions have not yielded results.

Recently BAZ CEO, Fanwell Mutogo said the bankability of the 99 year leases depends on the government’s push to end disputes and enhance land tenure security.

“Banks submitted a document to the authorities which raised concerns about land tenure security among other issues and we will soon see how soon they  will address the concerns raised,” he said.

In 2022, banks also  rejected new security mechanisms tabled by the government to make the 99-year leases bankable.

The banks were concerned that land grabs have continued abated hence the lenders were  not free to lend depositors’ money to farmers.

Also in 2021, Parliament intervention failed to resolve the longstanding wrangle between government and the banks over the contentious 99-year leases.

The document, which was a legally binding agreement between the government, which is the lessor and the farmer, who is the lessee, was meant to trigger massive cash into the agriculture sector through loans extended to the farmers who hold the 99-year leases.

The banks are not happy with some of the clauses on the leases where all distributed  land belonged to the State, meaning it could not be sold to recover funds in the event of farmers defaulting on loan repayments.

Under Section 72 of the Constitution, all land in Zimbabwe now belongs to the State and this disempowers the bank  to sell the land in the event of a default by farmers.

There is an increasingly growing concern among lenders that land can be taken away from the existing farmers who are potential borrowers.

Banks said this removes security on the part of land as it may be taken away at any time.

Instead, the lenders want immovable assets as collateral, which most farmers do not have and this has significantly affected production on the farms.