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Govt looks to new tobacco-selling season for financial boost

15/03/2017 00:00:00
by Agencies
 
Agriculture Minister Joseph Made
 
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HARARE: Zimbabwe has officially opened its tobacco-selling season, with hopes that the crop can help ease the country's financial problems.

The governor of the central bank, John Mangudya, says the country earns about $800 million a year from tobacco.

Hundreds of farmers are waiting to sell their crop, but some express concern that they may struggle to access their money due to the country's cash shortages.

Agriculture Minister Joseph Made said Wednesday that the quality of tobacco has improved, partly because of expanded irrigation programs.

But an electronic system installed for this year's sales failed at the inception, and it was back to the usual manual system.


Central bank governor John Mangudya

The country is likely to produce 205 million kgs of tobacco this year, slightly more than 2016, with sales of this top export likely to improve dollar supplies in the cash-strapped economy.

Tobacco Industry and Marketing Board spokesman Isheunesu Moyo said output would climb from 202 million kgs in 2016 after more farmers grew the crop.

Moyo said tobacco buyers had borrowed $700 million offshore to purchase the crop from farmers. The merchants process the leaf before exporting it, mostly to China, the largest investor in the Southern African country.

Zimbabwe is desperately short of dollars due to its moribund economy, although traditionally liquidity improves during the tobacco-selling season as cash is brought into the country.

Minister Made said tobacco farmers would be allowed to withdraw $1,000 from banks per day to allow them to purchase farming inputs for next season.

Cash shortages in the last 12 months have forced banks to impose daily maximum withdrawal for most Zimbabweans of sometimes as little as $50 per day.



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