Zimbabwe government announced guidelines and modalities on accessing the Z$18.02 billion Covid-19 pandemic economic recovery and stimulus package, with Z$2.5 billion have been disbursed so far to productive sectors.
The southern African nation unveiled the economic recovery and stimulus package, to assist in re-starting the economy which was hit hard by the Covid-19 pandemic.“Implementation of the economic recovery and stimulus package has already st arted in earnest with the Reserve Bank of Zimbabwe (RBZ) having already disbursed Z$2.5 billion for the productive sectors and the winter wheat programme,” Ministry of Finance and Economic Development said in a statement.
“Other than capital grants which are being disbursed through various line Ministries, all productive sector support will be financed by banks through the normal banking channels with government providing requisite guarantees to the financial institutions based on a risk sharing model.” Through the risk sharing model, banks will conduct credit assessment and due diligence of the applicants.
In the same vein, government will provide guarantees and banks are poised to monitor and evaluate the use of the resources by borrowers to ensure that the beneficiaries will repay the loans accessed.
Conditions for accessing the loans includes, having valid tax clearances and compliance certificates from the National Social Security Authority. Also, priority would be given to existing projects while new ones would only be considered in the health sector if they resulted in the localization of supply chains in the production of personal protective equipment (PPEs) for the Covid-19 pandemic.
Treasury said: “Productive sector lending interest rates have been lowered to not more than 20% and existing qualifying loans must be restructured to allow businesses to recover. Loan restructuring will also entail review and relaxation of regulatory guidelines and benchmarks”. “A grace period of up to three months will be given to allow businesses to effectively recover from the effects of the Covid-19 pandemic.”
Photo: Zimbabwe’s Finance and Economic Development Minister Professor Mthuli Ncube carrying a briefcase before presenting his national fiscal outlook to parliament. This has been a norm in the country whenever Ministers of finance present national budgets in Parliament.