By Trevor Makonyonga
The Reserve Bank of Zimbabwe (RBZ) has increased the tobacco growers’ retention for the 2020/21 season from 50% to 60% without compulsory liquidation of the retained forex amount.
This was said by the RBZ Governor, Dr John Panonetsa Mangudya, in a communique with Tobacco Farmers Union of Zimbabwe (ToFuZ) President Believe Tevera that was gleaned by Bustop TV.
“I would like to confirm our discussion that we have taken note of the issues you raised and we are pleased to advise you that we are increasing the growers’ retention from 50% – 60% this year and to allow flexibility in planning there will be no compulsory liquidation of the retained forex amount.”
Farmers will also be free to buy and sell their foreign currency from auction system which is currently in place through their banks.
“Farmers are also free to purchase and/or supplement their foreign exchange requirements from the auction system through bankers,” Mangudya said.
Mangudya’s response comes after the persistence by farmers union to get a raise in forex retention and the need to make tobacco farming lucrative for the farmers.
Earlier on, president of Tobbacco Farmers Union of Zimbabwe (ToFuZ) Believe Tevera had communicated farmers’ concerns with the RBZ governor regarding the issue of retention to which the governor responded.
“As a union we proposed through Tobacco Industry and Marketing Board (TIMB) a retention ratio of 70/30 % and as the sole producers of the crop, us the tobacco farmers of Zimbabwe are not prepared to accept anything less than 70% , we are not producing this tobacco for our personal or family use but we are producing it for the benefit of the whole nation , given that we believe that the government should give tobacco farmers listening ears, revisit and review the issue of forex retention as a matter of urgency.
“As a union we therefore urge and call upon the Reserve Bank of Zimbabwe, Ministry of Finance and the Ministry of Agriculture to address the issue of forex retention specifically for the tobacco sector as a matter of urgency before the kick start of the 2021 selling season. All inputs that we use in the production of the crop are pegged in US dollars, so surrendering 50 % of our forex being exchanged with the low rate of the forex auction system will negatively affect the production of Tobacco in Zimbabwe yet the crop is the second foreign currency earner after gold,” said Tevera.
”Speaking to Bustop TV, Tevera said that they were not happy with the 60% but are accepting the increase because it is a step towards the 70% that they want. Tevera said,
“(We are) not happy but (are) glad that it is a step towards the 70% we are demanding as the sole producers of the crop. We are accepting it (60%), it’s an achievement though we will not stop engaging RBZ to achieve our intended 70% mark.”
The Tobacco Industry and Marketing Board, TIMB, has since set the 22nd of March this year as the day tobacco auction floors will be officially opened.
