IFC APPROVES FINANCING FOR MERCHANT BANK AND THREE COMPANIES IN ZIMBABWE

Asiminia Caminis

The International Finance Corporation (IFC) has approved a credit line of US$5 million for National Merchant Bank of Zimbabwe Limited (NMBZ) and loans totaling US$816,000 for three Zimbabwean companies, Mukwa Milling Company (Private) Limited, Highveld Horticulture Zimbabwe (Private) Ltd., and Sable Safari (Private) Limited. IFC, a member of the World Bank Group, is the largest multilateral source of financing for private sector projects in developing countries. IFC's line of credit to NMBZ will be used to collateralize trade finance facilities at various international banks and to fund medium-term foreign currency loans to export-oriented companies. IFC recently made a Z$3.75 million (US$580,000 equivalent) equity investment in NMBZ, Zimbabwe's first indigenously owned merchant bank. The loans to the three Zimbabwean companies will be made by the Africa Enterprise Fund (AEF), IFC's vehicle for funding small and medium-sized projects with total costs ranging from US$250,000 to US$5 million. The US$200,000 AEF loan for Mukwa Milling Company, which manufactures wooden window and door frames, mainly for export to South Africa, will cover 48 percent of the financing required by the company for the acquisition of new machinery and an additional workshop, and long-term working capital. ..MORE.. - 2 - AEF's venture loan of US$216,000 to Highveld Horticulture Zimbabwe, which operates a vegetable and fruit packhouse and cold store in Mvurwi and processes fruits and vegetables for export, will help finance the company's expansion program. The company, which is owned by 33 commercial farmers and Selby Enterprises (Pvt) Ltd (Selby), Zimbabwe's second largest produce exporter, plans to purchase the packhouse it now leases. AEF's loan of US$400,000 to Sable Safari will help finance the upgrading and modernization of two safari camps at Chikwenya, on the Zambezi River, and Fothergill Island (Lake Kariba), and the construction of two new camps adjacent to Hwange National Park. AEF's loan will cover 46 percent of Sable Safari's project costs, estimated at US$863,000.