The Sunday Mail

business journalist

BANKS are now ready to lend in US dollars from the huge pool of Foreign Currency Account Balances (FCA) in response to the supportive policy measures implemented by the government.

A law recently passed by the government guarantees that the multi-currency payment system will be used for the next five years.

The new legislation is believed to have eliminated the risk previously associated with USD lending.

At the launch of the $30 million Horticultural Export Revolving Facility last week, FBC Holdings Group Chief Executive Mr John Mushayavanhu said banks now feel comfortable lending from FCA filings.

The recently unveiled facility, which is administered by a number of banks including FBC, CBZ, AFC and ZB, is backed by the government through the equivalent of $958 million in special drawing rights (SDRs) that Zimbabwe received from the International Monetary Fund (IMF). .

Banks, Mr. Mushayavanhu said, would lend more aggressively to horticulture farmers.

“We had on the one hand farmers who had the expertise and the land, and who had buyers for the produce in markets like Europe and elsewhere. These horticulturists would need money to build a greenhouse. . .

“They want money to upgrade their packinghouse to meet EU standards or the standards of the countries they export to. They want money, but the banks were unwilling to do that,” he said.

He said this was the reason horticultural exports fell from a high of US$300 million to US$77 million.

The US dollar loan-to-deposit ratio is currently very low.

Export boost

Speaking at the launch of the renewable horticulture facility, Minister of Lands, Agriculture, Fisheries, Water and Rural Development Dr Anxious Masuka said negotiations to export citrus to China were at an advanced stage.

“The protocol is being finalized.

“We are looking at more export markets, restoring the old ones and taking back our market share from Ethiopia and Kenya so that we are known again as Zimbabwe which exported these sought after vegetables,” he said. declared.

“If you went to the market in Amsterdam, for example, you would find that on the day of the auction Zimbabwean flowers were in high demand, so I look forward to an exciting future.”

The horticultural industry contributed 3.5 to 4.5 percent to the gross domestic product (GDP).

It generated $125 million in export revenue at its peak in 2000.

Zimbabwe’s various horticultural exports were mainly tropical fruits, citrus fruits and deciduous fruits, as well as various vegetables, nuts, avocados and cut flowers to European markets.

Currently, the industry contributes US$77 million in export earnings and employs around 18,700 people.

It is believed that the recently launched facility had the potential to fill the funding gap and boost productivity.