Zimbabwe Property Sales Suspended in South Africa

July 30 - A German bank and several South African farmers may need to wait longer for compensation owned to them by the Zimbabwean government, after the latter challenged the legality of the sale of its properties in South Africa.

The German development bank KFW Bankengruppe seized seven properties around South Africa after the Zimbabwean government failed to settle a multi million dollar loan.

In 2002, a government run iron and steel company simply failed to pay the bank back on a loan, and the bank therefore had no other choice but to seize the properties and put them up for auction.

The sale of the land was due to take place on August 2nd, but legal representatives for Zimbabwe filed an urgent application to halt the auction and the South African High Court postponed the sale, saying that all sides needed more time to respond.

The proceeds of other properties that were meant to be sold in the same auction were earmarked for a group of South African farmers who had their farms seized by Zimbabwe government officials as part of Mugabe's land seizure program.

A civil rights group took the case to court and a judge ruled that since the seizures were not legal, the group was justified in attaching Zimbabwean assets to settle costs to the farmers who lost out on millions.

The Zimbabwean government is arguing that properties are protected by international immunity and therefore cannot be auctioned off.

The new hearing is set for September, 2010.

7/30/2010 9:30:21 AM