HARARE – Deputy Finance Minister David Mnangagwa has defended the Ministry of Finance’s involvement in facilitating a debt settlement for Valley Seeds Private Limited, arguing that a letter issued to the company’s bank was a “commitment to pay” arrears and not a government guarantee requiring parliamentary approval.
Valley Seeds is reportedly linked to President Emmerson Mnangagwa’s nephew, Temba Nkatazo.
The issue arose in Parliament following concerns raised about a debt of US$191,578,835.56 owed by the government to Valley Seeds for inputs supplied under the Vulnerable Inputs Scheme.
Corban Madzivanyika questioned why the Ministry had seemingly guaranteed a loan for a private entity without seeking parliamentary consent, citing the Public Management Act.
According to Madzivanyika, the government’s commitment to pay US$5 million monthly for twelve months constituted a guarantee.
He highlighted a letter executed by Permanent Secretary for Finance, Economic Development and Investment Promotion, George Guvamatanga, which reportedly authorized systematic payments to Valley Seeds through their bank.
In response, Deputy Minister Mnangagwa insisted on a clear distinction between a “letter of commitment” and a “government guarantee.” He explained that due to “limited fiscal space,” the government could not immediately settle the debt.
To unlock the arrears, Valley Seeds reportedly discounted their debt through their local bank, which then requested an assurance of monthly payments from the government.
“In response to that, Government is currently owing Valley Seeds US$191,578,835.56 for inputs supplied under the Vulnerable Inputs Scheme.
“Due to limited fiscal space, Government could not immediately settle Valley Seeds debt. In an effort to unlock the arrears, Valley Seeds discounted their debt through their local bank.
“In turn, the bank requested Government to provide an assurance of a monthly payment of US$5 million which will be paid to Valley Seeds through their local bank.
“Following the above, the issued letter is a payment plan/commitment to Valley Seeds and assuring their bank that all payments will be done through their bank.
“In this regard, the letter that was issued is not a guarantee but a commitment letter to make payments on arrears accumulated,” Mnangagwa stated.
Madzivanyika, however, remained unconvinced, arguing that a commitment by the government to make payments effectively acts as a guarantee.
“The question still remains, why do you guarantee private players without the approval of Parliament? Under normal circumstances, you are supposed to come to Parliament as a Minister to say, the owners of the purse, this is what we are going to do and this is the transaction that I want to prove because it is a private citizen according to the portion of the law. So, I still request a genuine answer Hon. Speaker,” Madzivanyika asked.
The debate in Parliament comes against a backdrop of recent allegations involving Guvamatanga and potentially irregular financial transactions.
Leaked documents indicated that the Ministry of Finance, under Guvamatanga’s signature, provided a government guarantee for a US$20 million loan facility from Ecobank Zimbabwe to Valley Seeds.
This letter also acknowledged the US$191.5 million legacy debt and committed to monthly reductions of US$5 million.
Critics, including journalist Hopewell Chin’ono and former Finance Minister Tendai Biti, have strongly condemned the arrangement.
Chin’ono described it as “highly controversial,” alleging a lack of transparency, potential state capture, and a bypassing of parliamentary oversight. He argued that committing significant public funds to a private entity without clear public benefit was an act of corruption.
Biti accused the current Treasury leadership of facilitating the “looting of public funds” and called for Parliament to exercise its oversight role.
“Traditionally the Ministry of Finance plays an oversight role safeguarding public funds. Under Mthuli Ncube and George Guvamatanga, the gatekeeper is now the gate crasher.
“Treasury has become a hub of illicit crass extraction with no bounds nor limits. Parliament must do its job,” Biti stated.
Further leaked documents have also implicated Guvamatanga in a potentially irregular gold procurement arrangement involving Gaingrid Investments and Fidelity Printers and Refineries, raising further questions about the management of public finances.
Letters signed by Guvamatanga reportedly promised Gaingrid a 5% incentive on their gold deliveries. Furthermore, a September 4, 2024 letter outlined a “cash pledge and collateralised facility” with Ecobank, where the bank agreed to discount US$60 million owed to Gaingrid.
Gaingrid is allegedly linked to gold dealer Pedzisayi “Scott” Sakupwanya, who is reportedly an ally of President Mnangagwa.
Despite this arrangement, the Ministry of Finance pledged to pay Gaingrid US$8 million monthly for a year, amounting to US$96 million. A later letter dated April 7, 2025, confirmed an outstanding balance of US$36 million, highlighting a significant US$40 million discrepancy.
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