Today [Wednesday, 29 July 2020] the Government of Zimbabwe signed a legal agreement with former commercial farmers who lost their land during the Fast Track Land Reform Programme. The terms of the agreement have not yet been made public. They should because ultimately the bill falls on taxpayers.
From what has been presented so far, the total bill is US$3,5 billion. It’s not clear whether this includes payments due to farmers who were covered under Bilateral Investment Promotion and Protection Agreements. These farmers have arbitration awards against the government.
So who will pay? Does the government have the money? The government is broke. President Mnangagwa’s spokesperson George Charamba tweeted that “both sides will now jointly mount initiatives for raising funds”, a woolly statement which, without specifics, is utterly meaningless.
Charamba gives the impression that the “joint initiatives” include “floating long-term bonds”. There is nothing “joint” about a government bond. It’s an instrument by which the government borrows money with the promise to pay it back with interest. Chikwereti. Isikweletu.
So there’s nothing “joint” about it. If the government issues bonds, it’s a debt that it must pay back. I’m sure by now everyone is financially literate enough to understand that government debt is essentially a taxpayers debt because it is taxpayers who fund the government.
So in short, the bill for farm improvements is falling on the shoulders of taxpayers. But here’s the problem: the people who settled on the land and enjoy the farm improvements are alive and kicking. But they want everyone to pay their bill while they profit from the improvements.
This is quite apart from the fact that the Farm Mechanisation Scheme 2007/08 which the new elite farmers benefited from created a US$200 million debt which they did not pay. That debt, as many discovered recently, fell on the shoulders of taxpayers.
After the Farm Mechanisation Bill, there was a larger Command Agriculture bill (US$3 billion) which was also passed on to the taxpayer. Again the political elites were the principal beneficiaries. This tells you how much the taxpayer is literally carrying the political elites.
In light of what has happened and the freebies that this new landed class has enjoyed, surely it is only fair that they carry the cost of compensating the old farmers for the farm improvements? Why should everyone pay for something that they don’t use?
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