Mutapa Fund outlines Cottco’s  rescue plan

STAFF WRITER
The Mutapa Investment Fund (MIF), Zimbabwe’s sovereign wealth vehicle, has outlined a bold strategy to clear Cottco Holdings’ longstanding debts, with a full settlement of approximately US$5m  targeted within the next six months.
The intervention is part of a broader effort to revive the country’s cotton industry, bring financial stability to Cottco, and reintegrate the firm into Zimbabwe’s capital markets.

Appearing before the Parliamentary Portfolio Committee on Lands, Agriculture, Water, Fisheries and Rural Development on this week,  MIF chief executive officer Dr John Mangudya said the fund had already released US$5m toward settling outstanding payments, especially to cotton farmers, workers, and service providers.
“We want to ensure that Cottco pays its legacy debts, which are the money they owe to workers—about US$3.1 million, the transporters—about US$1 million, and the legacy payment to farmers, which is about US$6 million,” said Dr Mangudya.
“We are starting with the current crop and have disbursed US$5 million so far out of the US$10m [owed]. We hope to clear the debts within the next six months, and if there is any balance, by early next year.”
Cottco, once the heartbeat of Zimbabwe’s cotton value chain, has spent the last decade struggling under the weight of financial mismanagement, debt accumulation, and delayed payments.

In 2014, it voluntarily suspended trading on the Zimbabwe Stock Exchange (ZSE), marking a low point for a company once pivotal to the country’s export earnings and rural livelihoods.
Now under the strategic oversight of the Mutapa Fund, Cottco is being positioned for financial and operational rehabilitation.

Dr Mangudya said clearing the firm’s historical liabilities would be a critical step toward reinstating its listing on the ZSE—a move expected to improve transparency and unlock new investment opportunities.
“The resumption of trading of Cottco shares on the ZSE will enhance transparency within the organisation and assist in attracting new investors,” Mangudya told Parliament.
Market analysts say returning Cottco to the ZSE would help enforce discipline through financial disclosures and corporate governance standards required of listed entities.

For investors, this would signal a return to accountability—a key factor in restoring confidence in Zimbabwe’s agro-industrial sector.
In tandem with financial reforms, Cottco is also preparing to introduce a biometrically secured credit card system for cotton farmers to access agricultural inputs.

The digital tool is designed to replace the existing input distribution mechanism under the Presidential Inputs Scheme, which has been marred by corruption, side-marketing, and misuse.
Over the years, inputs such as seed, fertiliser, and chemicals—intended for smallholder cotton producers—have often ended up in the informal market, benefiting non-farming actors at the expense of genuine growers.
“The card will be for farmers to swipe for inputs at registered merchants.

The system will be linked to POSB and AFC banks and the biometrics from the Registrar General’s Office,” said Dr Mangudya.
“The card will only be for inputs and contain the biometrics of the farmer to prevent double dipping and abuse of the facility.”
Under the new system, farmers will be able to redeem inputs digitally, based on preloaded entitlements tied to verified biometric identities. The move is expected to close existing loopholes and ensure that support reaches legitimate producers.
Agricultural experts and farmer unions have long advocated for a traceable, fraud-proof system, arguing that transparency and equity in input distribution are key to restoring productivity.

The cotton sector plays a crucial role in Zimbabwe’s rural economy, particularly in drier agro-ecological regions where few other cash crops can thrive. However, years of poor governance, delayed payments, and input mismanagement have seen production volumes fluctuate and farmer confidence erode.
Cottco’s failure to pay farmers in full and on time has been one of the biggest reasons for the sector’s volatility. Some farmers resorted to side-marketing or abandoned cotton altogether. With the Mutapa Fund now stepping in to stabilise operations, stakeholders are cautiously optimistic.
“This is a very welcome intervention. Farmers have been waiting for years to get what they are owed,” said a representative of the Cotton Producers and Marketers Association. “If this plan works, we could see more farmers return to cotton in the next season.”
In 2025, Zimbabwe is targeting a recovery in cotton production, supported by improved input supply and better payment systems. Government officials say clearing past debts is key to unlocking that growth.
“You can’t talk about rural industrialisation or inclusive growth without fixing cotton,” said an Agriculture Ministry official. “The Mutapa Fund’s involvement gives us a credible partner to push the reset button.”
Formerly known as the Sovereign Wealth Fund, the Mutapa Investment Fund has become a central player in Zimbabwe’s efforts to revive state-linked enterprises. It manages a portfolio of strategic assets across key sectors such as mining, telecoms, agriculture, and energy.
Since taking over as CEO of the Fund, Dr Mangudya—previously the Governor of the Reserve Bank of Zimbabwe—has pushed for tighter oversight, financial transparency, and performance-based interventions across the Fund’s holdings.
The Cottco turnaround is being closely watched as a potential model for other troubled state-linked firms.
With a six-month target to clear legacy debt, plans for re-listing on the ZSE, and the rollout of a digital input distribution system, Cottco’s trajectory appears to be changing. However, execution will be key.
Dr Mangudya and the Mutapa Fund are under pressure to deliver quick wins in an environment where patience is thin and public trust has been eroded.