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Bank reviewing A1 farm permits

06 Jul, 2014 - 00:07 0 Views

The Sunday News

BANK chief executive officers are reviewing recently introduced A1 farm permits to determine whether they are acceptable collateral before issuing loans to holders.
The Bankers’ Association of Zimbabwe (BAZ) on Friday requested all heads of financial institutions to examine the documents to come up with individual assessments regarding their bankability.

Baz has since scheduled a meeting where the views will be consolidated into a single sector position, which will be tabled before Government.
Last week Government began issuing the permits to farmers who were allocated land under the A1 resettlement scheme.
The permits enable holders to assume full land ownership and make long term developments.

The first batch of 79 beneficiaries at Emily Park Farm in Makonde were handed the permits by President Mugabe last Wednesday.
Around 221 470 resettled farmers are in line to receive the documents in a process expected to take at least three years.

Experts say sticking points were likely to arise from the transferability of the permits, a matter some bankers have already pointed out.
A Baz official told our Harare Bureau the review was progressing.

“We have not yet analysed the document in order to ascertain whether the model is acceptable or not. It is, therefore, still premature to comment on whether banks will accept it as collateral.

“We are still trying to understand the implications of the document. Farmers need to be patient and allow banks time to look at the instrument and subsequently make their representations.

“Today (Friday) an email was sent out to all bank chief executive officers imploring them to begin internal consultations regarding the acceptability of the document. Bank chief executives are expected to then sit with their technical staff and analyse the document and prepare what they think about the instrument.”

University of Zimbabwe’s Institute of Environmental Studies (IES) deputy director, Dr Jeanette Manjengwa, said A1 permits provided better tenure security.

She, however, pointed out that agriculture funding should ideally be the responsibility of the farmer, Government and banks.
“From what I have gathered, the A1 permits seem to be more secure compared to the previous tenure document. They contain more official detail which includes a map of the plot, details about the farmer among other important information.

“The permits are more secure by virtue of the fact that as long as the farmers fulfil the conditions set in the agreement, they stand no risk of losing the land, therefore, making it permanent in a way.

“It is very difficult for Government to remove a farmer from the land as long as he fulfills the permit conditions. On the issue of funding for agriculture, I strongly believe that it is a joint effort of the farmers, Government and banks. All three arms need to pull in one direction for the development of the sector.”

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