US Bill Proposes Sanctions Relief for Zimbabwe—But With $3.5 Billion Compensation Catch
The United States Congress has introduced a bill to repeal the Zimbabwe Democracy and Economic Recovery Act (ZDERA), a sanctions law that has blocked Zimbabwe’s access to international financial support for over two decades.
The proposed legislation, tabled by Florida Republican Brian Mast, signals a potential shift in US policy toward Zimbabwe, but still places strict conditions on future cooperation.
The bill, titled the “Department of State Policy Provisions Act,” seeks to overhaul US foreign policy and includes a provision to repeal ZDERA.
However, it maintains a key requirement: Zimbabwe must fully compensate white former commercial farmers displaced under the country’s fast-track land reform programme before receiving any new support from institutions such as the World Bank or the International Monetary Fund (IMF).
In a detailed clause, the bill states:
“The United States shall not support any new or expanded funding from the International Monetary Fund or the International Bank for Reconstruction and Development (commonly known as the World Bank) for the Government of Zimbabwe.
The Government of Zimbabwe shall commit, within 12 months of the approval of such new or expanded funding, to remit all outstanding arrears owed under the Global Compensation Deed.
These arrears must be inflation adjusted to the date of enactment.
Compensation shall not be in the form of Zimbabwe-issued securities.”
“Failure to comply with this provision shall result in an immediate cessation of all United States support for any further funding from these institutions.”
In 2020, Zimbabwe signed a US$3.5 billion agreement with white farmers to compensate for infrastructure and improvements on seized farms—not the land itself.
As of April this year, the government approved compensation for 378 farms, amounting to US$311 million.
However, only US$3.1 million—just 1% was to be paid in cash, with the remainder issued in USD-denominated Treasury bonds with a 2% annual interest rate and maturities ranging from 2 to 10 years.
The Treasury allocated US$10 million in the 2025 national budget for farmer compensation.
Zimbabwean officials argue that the bond structure is necessary due to limited fiscal space. But under Mast’s bill, such payment methods would be deemed unacceptable.
The legislation explicitly rules out Zimbabwe-issued securities, even if denominated in US dollars.
If passed, the bill would require Zimbabwe to pay the full amount in cash within 12 months of loan approval from the IMF or World Bank.
As reported by NewZwire, Zimbabwe remains ineligible for new World Bank loans due to US$21 billion in debt and outstanding arrears.
The country is currently negotiating with creditors to clear these arrears—a key step toward unlocking future loans.
However, if the bill becomes law, any future financial support would depend on Zimbabwe meeting the compensation terms in full and within the specified timeframe.
ZDERA, enacted in 2001 and amended in 2018, was originally introduced in response to human rights violations, land seizures, and Zimbabwe’s military involvement in the Democratic Republic of Congo.
The 2018 amendment reaffirmed demands for compensation and legal compliance with rulings from the Southern African Development Community (SADC) tribunal, which declared Zimbabwe’s land reform discriminatory and called for either restitution or full compensation for seized land.
Zimbabwe’s Constitution, under Section 295, only allows compensation for “indigenous Zimbabweans” and those protected under Bilateral Investment Promotion and Protection Agreements (BIPPAs).
White farmers are entitled only to compensation for improvements—not the land itself—placing Zimbabwe in direct conflict with the SADC tribunal’s 2007 ruling, which demanded full compensation and restoration of property rights.
