TINASHE MAKICHI
The government has issued guarantees to cover financial institutions’ obligations in the event of defaults worth close to ZWL$950m, Business Times can report.
In a Government Gazette General Notice 245A of 2021, Finance and Economic Development Minister, Mthuli Ncube, said the guarantees were issued in terms of section 300(3) of the Constitution of Zimbabwe, read with section 20(1) of the Public Debt Management Act (Chapter 22:21).
Under the notice the government issued a guarantee as surety for the repayment by Infrastructural Development Bank of Zimbabwe (IDBZ) bond worth ZWL$300m being the aggregate value of the capital sum, in addition to accrued interest. The bond was issued by IBDZ in 2020.
“The guarantee shall remain valid and in force until June 30, 2024,” Ncube said.
Government will pay up to 50% of the indebtedness which the 2020 winter maize farmer owes to CBZ Agro-Yield (Private) Limited in the event that the beneficiary farmer fails to pay any of its obligations when due.
Ncube noted that the guarantee shall remain valid and in force until 31st December, 2020.
Government has also issued a guarantee as surety for the repayment by Silo Food Industries of the value subscribed through the Silo bills up to an amount not exceeding ZWL$350m being the aggregate value of the capital sum, in addition to accrued interest, on the Silo bills issued by Silo Food Industries in 2020.
A government guarantees has been issued as surety for the repayment by Agribank and FBC Bank Limited of the value subscribed through the Agro bills up to a total amount of ZWL$100m being the aggregate value of the capital sum, in addition to accrued interest, on the Agro bills issued by the two banks last year.
Under the same notice, the government issued another guarantee for Agribank to the tune of ZWL$200m being the aggregate value of the capital sum of Agro-Bills.
The guarantee shall remain valid and in force until 31st December, 2021.
