The Zimbabwean government has signed an agreement to pay American $3.5 billion in compensation to white farmers who were kicked off their land two decades ago.
It is a turning point in a dispute that has caused the Zimbabwean economy to collapse as food production and export earnings have dwindled and the country has faced US and European Union sanctions.
“Today is a major milestone,” Andrew Pascoe, president of the Commercial Farmers Union (CFU), which represents white farmers, said on Wednesday at the signing of the agreement in the capital, Harare.
“As Zimbabweans, we have chosen to resolve this issue that has been dragging on for so long.”
It is not certain how the compensation will be financed in the midst of the economic crisis.
Zimbabwe has inflation of more than 700% and has shortages of food, currency and fuel while more than 90% of the population is not employed in the formal economy.
A committee has been set up by the government, farmers and donors to raise money for the compensation agreement, Deputy President Constantino Chiwenga said during the ceremony.
Zimbabwe has experienced several food shortages since the government embarked on the often violent program to expropriate most large-scale white-owned farms from 2000 onwards.
The government said the land was forcibly taken away during the colonial era and had to be returned to black residents.
The compensation agreement is about improvements to land and assets on the more than 4,000 farms that have been taken down and does not relate to the land itself, Ben Gilpin, a director of the CFU, said earlier this month.
“This important event is historic,” he said. Emmerson Mnangagwa said during the ceremony. “It brings closure and a new beginning.”
The agreement was signed a few hours after the death of Agriculture Minister Perence Shiri, 65.