A recent High Court ruling insulating the Reserve Bank of Zimbabwe (RBZ) from property attachment lawsuits will likely leave many potential capital equipment lenders, or any other lender, on tenterhooks. Last week, Justice Tendai Uchena stopped Farmtec Spares and Implements from attaching roughly 4 hectares of RBZ land over a seven-year-old $2,1 million debt, and instead, ordering the lender to pay the cost of the suit.
Justice Uchena argued the Reserve Bank's assets belong to Zimbabtwe, and Zimbabwe cannot attach her own property, protected under law. Now, at a time the country is desperate to rebuild investor confidence, the ruling gives the disconcerting impression of an untouchable central bank, one that cannot be held to account by its creditors, even through court processes.
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