By Panashe Kaseke
The Zimbabwean government has been ordered by a London High Court to pay US$125 million to two companies, Boarder Timbers Ltd and Hangani Development Ltd, whose land was seized during the country’s land reform program in the early 2000s.
The ruling stems from an eight-year-old arbitration case at the International Centre for Settlement of Investment Disputes (ICSID), which found in favor of the companies in 2015. Zimbabwe had previously failed to comply with the ICSID ruling and pay the compensation owed.
Boarder Timbers Ltd, owned by German shareholders, had its properties protected by a bilateral investment agreement between Zimbabwe and Germany. Despite this protection, the government seized the land during the land reform program.
After winning the ICSID case, Boarder Timbers Ltd pursued legal avenues to enforce the ruling, leading to the current High Court decision. The court ordered Zimbabwe to not only pay the initial US$125 million but also an additional US$90 million in interest and legal costs.
This latest ruling adds to the financial pressures facing the Zimbabwean government, which is already struggling with economic sanctions and a currency crisis. It also raises concerns about the country’s adherence to international investment agreements.
