The Africa Export and Import Bank (AfreximBank) is focusing on increasing its loan funding systems on the back of increased demand for loans from Zimbabwean firms intending to revive production through borrowing money at affordable interest rates.
The Egyptian based multilateral financial institution has since January this year injected US$400 million in the form of loans at concessionary interest rates to key sectors of the economy.
AfreximBank Regional Manager for Southern Africa, Mr Gift Simwaka says while the financial institution has injected US$400 million in manufacturing, construction, mining and agriculture sectors of the economy, more funds will be disbursed next year.
â€œWe are in the process of considering fresh loans to the local industry and this will definitely translate into increased production volumes at a time when Zimbabweâ€™s industry is still experiencing challenges,â€ said Mr Simwaka.
An economic commentator, Mr Jonathan Kadzura says the commitment by AfreximBank to work with local banks is a reflection that local companies have a potential of regaining their status in terms of competitiveness with regional and international companies.
â€œI think such loans are quite a true reflection of how our industry is resilient in spite of challenges the country is facing. We hope this will be a positive impetus as we grow the economy further,â€ said Mr Kadzura.
Government is in negotiations with several regional and international financial institutions to assist in the growth of the economy through the provision of loans needed to recapitalise industrial operations.
The allocation of funds for on-lending by the financial sector is expected to solve challenges that are being experienced by local banks in accessing funds due to low deposit volumesÂ Â from the industry and households.