Zimbabwe has taken a notable step toward economic recovery by compensating white farmers whose land was repossessed during the controversial Land Reform Programme of 2000. Finance Minister Professor Mthuli Ncube announced the initial disbursement of US$20 million (approximately R370 million), marking a critical move in resolving the nation’s long-standing debt crisis.
Compensation Process Officially Underway
In a press statement, Finance Minister Ncube confirmed that the compensation payments started in January 2025, focusing on farmers from countries with Bilateral Investment Promotion and Protection Agreements (BIPPAs), including Denmark, Germany, the Netherlands, Switzerland, and former Yugoslavia.
“I am pleased to announce that the compensation process has begun,” said Ncube. “This initiative is essential for restoring trust, fulfilling our commitments, and aligning with the principles outlined in Zimbabwe’s Constitution as we address our debt challenges.”
So far, 94 farms have been approved for compensation under BIPPA agreements, with several farmers receiving their initial payments. This process is seen as a significant milestone in Zimbabwe’s journey toward economic stability and reconciliation with affected investors.
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International Community Welcomes the Move
Ambassadors from Germany, the Netherlands, and Switzerland have applauded Zimbabwe’s efforts, describing it as a “historic achievement.” The diplomats commended the government for allocating funds in its 2024 budget to ensure the compensation of BIPPA-protected farmers becomes a reality.
“The framework set by the Zimbabwean government for full compensation represents real progress. Several investors have already received initial payouts, bringing them closer to closure. This is a critical step toward a comprehensive resolution,” said one diplomat.
Under Section 295 (2) of Zimbabwe’s Constitution, farmers protected by international agreements are entitled to compensation for both the land and any improvements made to it, ensuring fair treatment for those affected by past policies.
Boosting Investor Confidence and Economic Recovery
This compensation initiative is part of Zimbabwe’s broader strategy to clear arrears and resolve its debt crisis. The government has engaged in ongoing dialogue with creditors and international partners to restore investor confidence and unlock new financing opportunities.
Dr. Akinwumi Adesina, President of the African Development Bank Group, praised the move, highlighting the government’s commitment to fostering a more trustworthy investment environment.
“This action demonstrates the Zimbabwean government’s goodwill and dedication to rebuilding trust with investors. It’s an important step toward attracting future investments.”
Multi-Year Compensation Plan in Progress
The US$20 million allocated in the 2024 budget is just the beginning. The Zimbabwean government has pledged an additional US$20 million in the 2025 budget, with a long-term plan to settle the remaining US$125.9 million by 2028.
While the current payments are a small portion of the total owed, the government’s commitment to fulfilling its obligations is expected to enhance international confidence in Zimbabwe’s economic recovery plan.
Zimbabwe’s Initiative in Contrast to South Africa’s Sanctions
As Zimbabwe works to rebuild its image on the global stage, neighboring South Africa faces a different challenge. The United States has imposed sanctions on South Africa over its land expropriation policies and recent positions on international issues. The contrasting approaches highlight the different paths each nation is taking in addressing land-related matters.
