(Bloomberg) -- Zimbabwe expects to receive as much as Z$2 billion ($139 million) from local banks after they agreed to help finance small-scale farmers in the government's bid to increase food production, Finance Secretary George Guvamatanga said Friday.
In terms of the agreement announced Thursday, the government will provide guarantees for loans granted to farmers of grain and oil seeds. The lenders include Agriculture Bank of Zimbabwe Ltd., the banking unit of CBZ Bank Ltd., and Stanbic Bank.
The government has, until now, provided finance to the agriculture sector under its Command Agriculture program, which sees the Ministry of Agriculture granting fuel, seed, irrigation and the necessary mechanized equipment to small-scale farmers. They, in turn, sell their produce to the Grain Marketing Board.
The government has declared a state of disaster in all urban and rural areas, saying the worst drought in almost 40 years has cut crop output by almost half.
To contact the reporter on this story: Godfrey Marawanyika in Harare at gmarawanyika@bloomberg.net
To contact the editors responsible for this story: Gordon Bell at gbell16@bloomberg.net, Hilton Shone, Jacqueline Mackenzie
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