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Tobacco farmers withhold crop

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©️ TOBACCO farmers countrywide are not keen to release their golden leaf for sale at auction floors demanding all their earnings in United States dollars due to a lack of confidence in the local currency, a government official has said.

This comes as the Reserve Bank of Zimbabwe (RBZ) has offered to pay tobacco farmers only half their earnings in forex while the cash-strapped government retains part of the forex in its coffers.
The RBZ is battling to keep its local currency relevant as most businesses prefer to use foreign currency due to the unpredictability of the local unit.
Responding to Zanu PF chief whip Pupurai Togarepi in Parliament after he demanded to know what the government was doing to ensure farmers are not short-changed, deputy Finance minister Clemence Chiduwa said consultations on the way forward were underway.
“So far, we have earned US$70 million. That is, we have received just 14 percent of what we had envisaged, but farmers are now threatening to withhold their crop. We are however, in negotiations with our farmers to make sure that we come up with a win-win situation,” Chiduwa said.
Tobacco Industry Marketing Board (TIMB) chief executive officer Andrew Matibiri concurred with Chiduwa saying the farmers were delivering the crop in trickles.
“We are obviously concerned because very few farmers have brought their tobacco. The minister is right but I am not sure what the ministry’s average expectation is. As for us, we are guided by the ministry of Agriculture figures,” Matibiri said.
All this comes after a similar promise to pay half the earnings in hard currency was made last season but the government failed to deliver as forex shortages continued.
It is that failure that has prompted calls to hold on to this year’s crop by the growers.
Tobacco is one of Zimbabwe’s top export earners and last year brought in more than US$500 million in earnings.
The country is the largest grower of tobacco in Africa and has some of the best climatic conditions to grow the crop in the world, despite the persistent climate change-induced droughts southern Africa is facing.
Last year, TIMB sold 256 million tonnes of tobacco, which was the highest output since the chaotic land reform programme 20 years ago. However, the future of the tobacco industry also hangs in the balance due to the World Health Organisation (WHO) Framework Convention on Tobacco Control that restricts smoking and use of tobacco.

 

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