The Government is seeking to change the terms of a US$3.5 billion compensation deal signed with white former farmers two years ago after twice missing agreed-to payments.
According to the original deal, white farmers whose land was compulsorily acquired by the government two decades ago should have received half the money within the first year, followed by four $437.5m annual installments.
The revised plan was part of Finance Minister Mthuli Ncube’s budget presented on Thursday. Speaking in reference to the new agreement, Ncube said:
Under the $3.5bn Global Compensation Deed in September 2022, the government made an offer for the settlement of the GCD which was accepted by former farm owners through a referendum.
The president of the Commercial Farmers Union (CFU), Andrew Pascoe, said they will hold talks with Ncube to understand what he meant.
Speaking to Bloomberg by phone, Pascoe denied that group members held a referendum on the terms. He said:
Considerable progress has been made, but we haven’t signed anything yet.
The new proposal sees US$350 million being paid over four years. That would include installments of US$35 million a year for three years and the balance in 2026 raised from selling the 12.5% stake the farmers hold in state-owned miner Kuvimba. Said Ncube:
The cash payments will be made in any jurisdiction in dollars to an account of former farm owners’ choice, payable biannually in February and July.
Ncube said the government will issue dollar-denominated treasury bonds to pay the remaining US$3.15 billion. | Bloomberg