US$5m for revival By Bright Madera

Economic and Trade Revival Facility and the low uptake is due to the cumbersome approval process.
BAZ president Mr John Mushayavanhu, who is also the chief executive of FBC Holdings, said banks were not putting spaners in the works but had to follow due process.
The Government and the Africa Export and Import Bank launched ZETREF last year for the private sector to return to full production.
“Banks need to have a shortlist of clients and that list has to go through to the approval committee. We are looking at a number of issues even the geographical disbursement of funds, and this might take a bit of time,” said Mr Mushayavanhu.
He added that the facility was supposed to be parcelled out in a manner that ensures proportional and equitable distribution in relation to the country’s regions and productive sectors.
Finance Minister Tendai Biti recently told Parliament that Government had lined up a number of facilities to benefit struggling companies but the companies were not taking up the funding saying less than US$10 million had been disbursed so far.
When the facility was announced last year, Minister Biti said the funding would be biased towards small and medium enterprises.
Zimbabwe National Chamber of Commerce president Mr Trust Chikohora said industry was looking for funding and they were still going for the expensive local facilities because companies were not aware that ZETREF was now accessible.
“Banks should do more in terms of awareness – industry is looking for funding and the availability of ZETREF is what industry wants. Banks still have to do more to reach out to industry,” said Mr Chikohora.
ZETREF has attracted interest from the private sector due to its reasonably priced facility with longer-term maturities.
Most companies that had diversified over the year to unlock shareholders value are now disposing of non-core assets to finance working capital and retire expensive debt.
Interest rates on the market range between 12 and 25 percent per annum.
ZETREF finances the acquisition of equipment and capital goods for use in enhancing output, quality of goods, services, the purchase of raw materials and spare parts.
Analysts said concerned parties should speed up the disbursements because the recovery of our economy will remain a pipedream without the rebounding of the private sector.
“Experiences around the world have shown that private sector led growth is a prerequisite to the successful take-off of an economy,” said one analyst.
Minister Biti then said the banks should stick to the thrust of the facility, which is onlending to the private sector at comparably cheaper rates than those currently obtaining in the market. Most companies have failed to capitalise operations due to the high cost of money on the market, affecting the industrial production base and general economic growth.
Lack of capital has been identified as one of the major structural bottlenecks currently bedevilling the country’s economy and ZETREF is one of the efforts to turn around the fortunes of the productive sectors.
Government in collaboration with Afrexim Bank and its local administrative agent, Interfin Bank, has put in place adequate safeguards to ensure that no speculative tendencies derail the initiative.
It has been difficult to access funding due to Zimbabwe’s deteriorating creditworthiness over the previous years.