US$22,5m for industry retooling sailing smoothly
The country’s biggest industrial representative body, Confederation of Zimbabwe Industries (CZI), says the disbursement of the US$22,5 million Government allocated to industry for retooling is underway with no glitches reported so far.
The funding is part of the US$80 million set aside by the Second Republic for the productive sectors from the US$958 million Special Drawing Rights (SDRs) Zimbabwe received from the International Monetary Fund (IMF) as part of the General Allocation of US$650 billion the multilateral lending institution released to member countries globally.
In December last year, Treasury announced modalities for accessing resources allocated to the productive sectors, where US$22,5 million was set aside as the Industry Retooling and Replacement for the Value Chain Revolving Fund, US$30 million under the Horticulture Revolving Fund.
The Tourism Facilities Services Development and Upgrading Revolving Fund was allocated US$7,5 million and US$20 million to the Smallholder Farmers Irrigation Infrastructure Development Fund.
The aggregated SDRs allocated to the productive sectors of the economy represents 8,4 percent of Zimbabwe’s total allocated SDRs.
CZI president, Mr Kurai Macheza, told Herald Finance and Business last week that no complaints have so far been put forward through the industry representative body, an indication that the disbursement process is sailing smoothly.
“The modalities of accessing that facility was done through the banks but at this stage we don’t have a full list of who actually was able to get that money, and how much has been drawn down.
“We are busy collecting the information and so far we have not heard of any challenges, people have not come with any challenges that they may be facing,” he said.
Some of the steps for accessing the above facilities include submission of an application through the participating banks, the respective bank shall conduct their normal credit assessments and normal due diligence through the risk sharing and co-financing model.
The application from the bank should include a letter of support for the project from the line Ministry and the banks will forward the approved applications to the Treasury through the respective parent ministry.
The Treasury has also indicated that the SDRs resources to the productive sectors will be done through specific banks at concessionary rates.
Bankers Association of Zimbabwe president, Mr Fanwell Mutogo, said because the resources from the SDRs to the productive sector are being disbursed through selected financial institutions, he would not be privy to the amount so far drawn down.
“As the disbursements are being done by selected banks I wouldn’t know much in that regard. I only deal with issues which are sector-wise. I would know if the disbursement was being done by all banks,” he said.
The productive sector requires funding for retooling and recapitalising operations to improve production efficiencies and boosting output as the Government rebuilds the economy in line with the National Development Strategy 1 (NDS 1).
Recently the Ministry of Industry and Commerce urged players in the leather, cotton, pharmaceutical, fertiliser and agro-processing sectors to tap into the US$22,5 million Retooling for New Equipment and Replacement for the Value Chains Revolving (REVCRF) facility by submitting applications.
The ministry said the fund is now operational and those eager to access the revolving facility were supposed to submit their application letters through selected participating banks — FBC, CBZ, CABS, AFC, ZB Bank, Steward and Ecobank for assessment.
The banks will then forward the letter accompanying the support for the project to the Treasury through the respective ministry.
Said Minister Nzenza: “The Ministry of Industry and Commerce would like to advise that the US$22,5 million Retooling for New Equipment and Replacement for the Value Chains Revolving (REVCRF) is operational.”-herald
